Given the dynamics we've discussed earlier regarding buybacks, it should be no surprise to see that they tend to be additive to performance. Of course, critics acknowledge that buybacks tend to boost short-term prices. How could anyone deny that an increase of buying any asset, ceteris paribus, increases its price? But what critics miss is that gains are not limited to the short run.
Topics: Stock Selection Research
We're getting a little tired of using the word "unprecedented," but no other word captures the recent trends in both deficit spending and money supply expansion. Also unprecedented are the stratospheric prices for cryptocurrencies. And there are good reasons to believe that these violations of precedence are not merely coincidental, but rather logically related to one another.
Last year we wrote a lot about the history of Emerging Market (EM) overperformance. That historically it tends to overperform developed markets; that it does not always overperform; the conditions under which it does overperform.
Remember early last year when oil prices 'went negative'?
Well, despite scary headlines, the actual prices themselves didn't go negative, but there certainly was a major drop in the value of oil. Markets often get the direction of the economy right, but they also can go too far.