While a rolling returns analysis provides useful information about
relative performance over typical holding periods, it does not take the fund's exposures or risk into account.
But it's worth noting because if investors are being more sensitive to actual company operating performance, then the trend in
relative performance between high and low quality companies may continue.
The
recent relative performance of European insurance has meant valuations have risen above our view of the appropriate trade - off between value and quality resulting in some profit taking.
When writing about investment returns, they are most often presented as percentages and
as relative performance versus widely followed indexes.
However, following similar times in the past, value investors achieved both strong absolute returns and robust
relative performance versus the market indexes.
In the analysis, a long history of data over a number of different economic and market cycles is usually required to identify the key factors and leading indicators that can
predict relative performance.
Consequently, we can't depend on getting these
same relative performance results in the future with these two particular stock portfolios.
As with factors, starting relative valuation is negatively correlated with
subsequent relative performance, with overwhelming consistency and impressive statistical significance.
So, if you are in a fund that has had
positive relative performance over a full market cycle, you may want to stay the course — particularly when market volatility hits.
Following similar times in the past, value investors achieved both strong absolute returns and
robust relative performance versus the broad market indexes.
In addition to improvement in
relative performance figures, large - cap equity managers also appeared to benefit from better security selection skills (see Exhibit 1).
The strategy invests in one of a pair of negatively correlated, in this case, ETFs, based on the
recent relative performance of the two ETFs.
While a comparison of rolling returns assesses average
relative performance over typical holding periods, it does not take the fund's volatility or exposures into account.
That said, my
best relative performance as an investor came during and immediately after panic periods like we have had in the past 20 years.
In brief, upgrading involves the ranking of funds by
relative performance in several risk categories; one sells the lowest ranked funds and «upgrades» to the highest ranked funds.
And let's be clear, in the case of Hess I believe the real issue is the company's extremely
poor relative performance over the years and which slate of directors is best situated to take the company forward.
Jawboning works when economic actors are unafraid of systemic worries, and are only concerned
with relative performance in the own local markets.
To better understand the currency risk of the portfolios beyond
tracking relative performance and currency movements, we use the Northfield U.S. Macroeconomic Equity Risk Model to breakdown total portfolio risk.
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How Relative Performance Works, Why Trading Volume is Important, and Other Chart - Reading Lessons