These are some of the top risks associated with each development phase and an estimated annual return the market might currently
expect for the equity investor.
Not exact matches
Because
equity investors — that tend to get what they ask
for — increasingly are saying enough is enough, and a lot of releveraging activity was front loaded, and with an
expected more benign rate hiking cycle there is less urgency to pull the trigger on deals, we continue to think that corporate balance sheets (ex-energy, ex-materials) will improve in 4Q and into 2016.
Also known as the VIX, the index in question is a measure of
expected price swings in US
equities that serves as a barometer
for investor nervousness.
And now that the time
for revisionist history has arrived, and strategists no longer have to serve a political agenda and scare
investors and traders into voting with their wallets, the research reports calling
for precisely the outcome that we
expected are coming in fast and furious, starting with none other than Goldman, whose chief strategist David Kostin issued a note overnight in which he says that «the
equity market response to the election result will be limited» and adds that «our year - end 2016 price target
for the S&P 500 remains 2100, roughly 2 % below the current level of 2140.»
Well, it will certainly lift the rate of return
investors expect from stocks, but bulls insists that with earnings growing 20 percent this year, the
expected return may be sufficiently high, so that there will not be any shift out of
equities, that corporations are going to make enough money to more than compensate
for higher rates.
Where: D =
Expected dividend per share one year from now k = Required rate of return
for equity investor G = Growth rate in dividends (in perpetuity)
In short,
investors should
expect smaller excess returns
for the risk of owning
equities in the future than they enjoyed in the past.
If
investors come to feel that the central bank is prepared to raise rates more aggressively than
expected, then that could be a big headwind
for equities, especially as all of Trump's policy proposals will add to US national debt.
Most
equity investors invest
for only a few years and then
expect to exit.
We don't
expect renewed bouts of euphoria, but we see scope
for investor optimism to lift
equities and other risk assets, and see a mild rise in bond yields.
The new options are
expected to hold particular market appeal
for European
investors interested in targeted exposure within key U.S.
equity benchmarks.
At the time, stocks were
expected to have a higher dividend yield than bonds to compensate
investors for the extra risk carried by
equities.
«On the business side we
expect to see significant interest from
equity funds and professional
investors keen to capitalise on the growing worldwide demand
for Australian beef,» Mr Butchers said.
A joint venture involving ProCure, a New Jersey private -
equity operator of three proton centers, has struggled to meet targets; at one center, which opened to widespread publicity and
investor excitement in 2012, only one - fourth of all patients are coming
for prostate cancer treatment, well below the
expected 80 percent.
Sometimes
investors make the mistake of forgetting that
expected returns
for equities are only reasonable over the long term (i.e. 20 years or more).
In return
for accepting a little additional risk, the all -
equity investor can
expect an extra 0.5 % to 1 % in annual return.
I am pretty comfortable with
equities and stocks though, having been a stock
investor for 2 decades, so rebalancing into stocks has never been an issue
for me; it's more to do with trusting how other asset classes are
expected to behave in the long term (e.g. precious metals, real estate, commodities).
At the time, stocks were
expected to have a higher dividend yield than bonds to compensate
investors for the extra risk carried by
equities.
And
for many
investors who are retired and / or have near - term liquidity needs, investing in
equity exposureswhile necessary to generate higher
expected returnsalso prevents many
investors from sleeping at night!
The strategy aims to sell assets when their risk - adjusted
expected return is falling (rising market volatility) and buying
equities when their risk - adjusted
expected return is rising (falling market volatility) to provide better risk - adjusted portfolio returns and to account
for investor's risk tolerance.
Cost of
equity A company's cost of
equity is the annual rate of return that an
investor expects from a firm in exchange
for bearing the risk of owning its shares...
The agencies will need more capital
for lending, so I would
expect more preferred stock issues, and perhaps an
equity issuance, if to a key
investor, like the US Government.
McClendon said that Chesapeake
expects to make investment opportunities with CNGV available to other natural gas producers, venture capitalists, private
equity players and other large - scale energy and technology
investors, especially those looking
for breakthroughs in scalable, green energy technologies.
We
expect these numbers to grow signifigantly over the next few years presenting a opportunity
for investors that could outperform some of the opportunities and gains we have seen in
equities and commodities in recent times.
At that level, the private
equity firm
expects to generate juicy annual returns of 20 % or more
for its
investors simply by performing needed maintenance and leasing the property at market rates.
Equity investors pushed the market higher as they
expected increased defense and infrastructure spending, potentially higher wages, a pro-bank administration, which should all bode well
for housing.
The company estimates that, on average,
investors who put down 20 percent on a property and hold it
for 15 years can
expect annual returns of 11 to 19 percent, a figure that includes rental income, appreciation and increased
equity.