Insights
The Future May Not Be As Rosy As Equity Investors Assume
NBR Articles, Published 9th March 2021
Many investors and fund managers seem to expect long-term local-currency returns from equity markets of 7% to 9% per annum. In this article, we argue that long-term local currency returns from global equities are more likely to be 5% to 6% per annum, and even that level of growth is dependent on a significant growth in renewable electricity generation. Higher electricity prices may be needed to encourage the required investment in renewable generation...
Read MoreWhy Higher-Risk Doesn't Pay Off In Equity Investing
NBR Articles, Published 9th March 2021
Historically, higher-risk equities have not produced any incremental return to compensate for their incremental risk. The behaviours that have contributed to this "anomaly" continue to this day. This creates opportunities for investors...
Read MoreBitcoin, The Ultimate Unethical Investment
NBR Articles, Published 3rd February 2021
Bitcoin does a poor job as a dependable store of value, as a diversifier in an investment portfolio, or as a medium of exchange. People should also consider bitcoin’s role financing unethical activities...
Read MoreHow Fiscal Largesse Boosts Demand For Equities
NBR Articles, Published 16th December 2020
In recent years governments have been spending more than they’ve collected from taxes. This causes a bidding war for equities as investors rebalance the additional liquid wealth that they accumulate as a result of the fiscal deficits...
Read MoreThe Forgotten Financials
NBR Articles, Published 10th November 2020
Many investors and fund managers avoid financial companies such as banks and insurers. This may not be a good move – the market pricing of these companies means that investors could do well even if the banks and insurers continue to earn poor returns on capital...
Read MoreHow Passive Decisions Affect Investment Markets
NBR Articles, Published 6th October 2020
If ETFs and other passive funds spread their funds evenly across markets, they wouldn't affect market pricing. However, these funds are not spread evenly, which means that passive funds are distorting market prices...
Read MorePremium On Growth Stocks Echoes Dotcom Boom
NBR Articles, Published 1st September 2020
The premium that investors have to pay to invest in growth companies is the highest its been since the dotcom boom. To achieve good returns over the next several decades, a number of today’s darlings (e.g., Nvidia, salesforce.com, Tesla) would need to grow to the point that they become even more dominant than Microsoft and Apple are today. While some companies may achieve this, many will disappoint...
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