Perspectives on industry challenges and opportunities affecting you and your clients.
The Knowledge Center is your source for perspectives on industry challenges and opportunities affecting you and your clients. Below are materials from SEI's Investment Management Unit. For industry-specific thought leadership, please visit the following sections:
Stormy January More 2011 than 2008Feb52016Article
Central bank measures, economic events, and financial markets defined January 2016.
Fourth Quarter Economic Outlook: More of the Same in 2016, with a Little Less CertaintyJan262016Article
The more things change, the more they stay the same. As investors enter 2016, they are facing as many uncertainties as last year — perhaps more. Despite that, we will give risk assets the benefit of the doubt until central banks begin to pursue tighter money policies that raise interest rates to much higher levels.
Fourth Quarter Market CommentaryJan112016Article
The fourth quarter began with a combination of mixed economic reports and accommodative central bank policies.
High Yield: Outflows Precede OpportunityDec172015Article
A confluence of forces have been weighing on the high-yield market, from commodity strains to investor outflows, rate-increase pressures and year-end tax-loss selling. Current high-yield pricing and yields are considerably more attractive than their long-term averages.
We Have Lift-off: Expect a Long, Slow Trip AheadDec162015Article
The U.S. Federal Reserve (Fed) has initiated the first hike in the federal funds rate since June of 2006
Investors Emboldened in OctoberNov102015Article
The fourth quarter began favorably; economic conditions were mixed in October, but major central banks remained accommodative. The combination appears to have emboldened investors, whose return to equity markets erased much of the third quarter’s losses.
Volatility Heightens: Third Quarter 2015 Market CommentaryOct62015Article
The third quarter was marked by heightened volatility and a spate of interventions by the Chinese government. Fixed-income market performance was mixed, with wide performance dispersion between “safe-haven” and risk assets.
China Sneezed. Will the Rest of the World Catch a Cold?Sep252015Article
Turmoil is revealing a mixed outlook for global growth pockets of strength and weakness in emerging markets.
Commodity-producing economies and those with close ties to China are struggling.
Collateral Damage to Commodities; China's Effect in AugustSep42015Article
Global equity markets performed poorly in August as concerns about the broad impact of China's selloff spread.
Reaping the Whirlwind: Second Quarter Economic OutlookJul22015Article
In our current environment, we expect the global economy to gain traction, which should provide a tailwind to equity markets, even in those countries further along in their business cycles and facing rising interest-rates.
Major Central Banks Hold Their Bearings: April Monthly Market CommentaryMay62015Article
Major central banks held their bearings amid tight elections in the U.K., debt-crisis brinksmanship in the eurozone, weak first-quarter economic growth in the U.S., and disinflation in Japan. Equity and fixed-income markets generally performed well as risk assets benefitted from favourable conditions.
Share Buybacks: A Good Use of Capital?May52015Article
A share buyback is a return of capital to investors and occurs when a company purchases its own shares. Buybacks among U.S. corporations are currently at historically high levels, providing support to equities.
Investment Fundamentals: DeflationApr152015Article
Inflation measures the overall change in prices of goods and services over a set period—and deflation is the term used when these prices fall over time.
Behavioral Finance: Confirmation Bias, Cognitive Dissonance, and RecencyApr142015Article
In this segment of our Behavioral Finance series, we will examine confirmation bias, cognitive dissonance and recency, additional behaviors that may lead us to make investment mistakes.
Investment Fundamentals: DiversificationFeb112015Article
They say variety is the spice of life. But when it comes to investing, variety can be a key to long-term success. But just what does diversification mean? And why might it be beneficial?
Investment Fundamentals: CurrencyDec32014Article
The latest in our Investment Fundamentals series. This edition covers how currency promotes economic activity and affects purchasing power.
Investment Fundamentals: Standard Deviation (Volatility)Nov112014Article
Standard deviation, also referred to as volatility, measures the variation from average performance. Within the context of a diverse portfolio, allocations to riskier assets can make sense even for conservative investors, as these allocations can actually reduce a portfolio’s overall volatility.
Behavioral Finance: The Three A's - Availability, Anchoring, and AdjustmentOct272014Article
In our last paper, we explored the biases inherent to heuristics. Now we explore availability, anchoring, and adjustment - shortcuts that are rooted in investor's inclination to project their current frame of reference on situations that are not applicable.
Behavioral Finance: Loss and Regret AversionOct272014Article
According to Prospect Theory, investors tend to qualify gains and losses through the lens of various heuristics (rules of thumb), thus limiting their ability to make reasonable decisions. Loss aversion and regret aversion can drive investors to make inferior decisions through passive behavior.
Behavioural Finance: Rules of Thumb and RepresentativenessJul302014Article
In Behavioural Finance: An Introduction to Human Error, we noted that Kahneman and Tversky were smart academics who found many ideas for their social science experiments in the mistakes that they themselves made as well as the mistakes that their intelligent colleagues and subjects made. Kahneman and Tversky noted some rules of thumb that often lead investors astray.
Risk Parity: The ConceptSep32013Article
Investors are typically counselled to diversify capital across asset classes in an effort to reduce risk. In light of this, it could be something of a surprise to learn just how concentrated a traditionally diversified portfolio may be in terms of its sources of risk.
Investment Fundamentals: Bond Market MathsAug72013Article
In recent years, global central banks have kept interest rates low in an effort to support the struggling global economy. Since hitting multi-generational lows, interest rates (and bond yields) have spiked significantly higher.