REDWOOD BLOG | Apr. 24, 2017

The Herd: Are ETFs Changing the Structure of the Markets?

by Craig Basinger, CFA & Shane Obata   There is no question Exchange Traded Funds (ETFs) have exploded in popularity. They offer many benefits to investors and their merits are well known. There is also rising evidence ETFs are changing the structure of the markets and how investors behave. Just to show how the popularity […]

REDWOOD BLOG | Apr. 17, 2017

Let’s Make a Deal

by Craig Basinger, CFA In 2015, a new all-time record was set for the dollar value of worldwide mergers and acquisitions (M&A), at an impressive $5.7 trillion. This bested the previous record of $4.9 trillion in 2007 and made the M&A binging late in the tech bubble look small by comparison. Over time, the market […]

REDWOOD BLOG | Apr. 13, 2017

Challenges in the current Emerging Markets bull market

By Edward Lam, Lead Fund Manager   The market continues to be well supported. For 12 months now, month after month and with little pause, I have done my best to argue the idea that emerging markets have started on a new bull-market journey. I see no reason to stop. There was once an idea […]

REDWOOD BLOG | Apr. 12, 2017

February 8, 2016 was more important than November 8.

by Richard Bernstein Questions whether the stock market could enter a correction or worse, because of Washington, DC’s policy failures sem to totally miss the point that fundamentals were improving long before the presidential election. Certainly, the market’s appreciation accelerated after the election, but few investors seem aware of the improvement in fundamentals and market […]

REDWOOD BLOG | Apr. 10, 2017

Best to be Unloved

By Craig Basinger, CFA Everyone likes a good analyst upgrade on a stock they already own. Depending on the analyst, size of following, and size of firm, share prices certainly react to these changes of opinion. Think about this analyst rating change for a minute. Nothing has actually changed for the company: their business is […]

REDWOOD BLOG | Apr. 3, 2017

Indexing Bias

By Derek Benedet, CMT & Craig Basinger, CFA You won’t find this bias in any of the research or books on behavioral finance; we are inventing a new one. Indexing Bias is how investors view a company once it has been added or deleted from an index. One would think that a company added to […]

REDWOOD BLOG | Mar. 27, 2017

Good to Gooder to Goodest?

by Craig Basinger, CFA Last summer, something that started out rather small has been slowly gaining momentum ever since – the return of economic growth. If you can ignore the media, day-to-day focused news reporting, and look into the less exciting economic data in the background, we are seeing broad based improving momentum. This has […]

REDWOOD BLOG | Mar. 21, 2017

Market efficiency

by Chris Kerlow, CFA “Is that a $20 dollar bill lying on the ground?” asks the student “No it can’t be”, answers the professor. “If it were, someone would have picked it up by now.” – Caption from Howard Marks’ The Most Important Thing The efficient market hypothesis (EMH) was developed in Chicago during the […]

REDWOOD BLOG | Mar. 7, 2017

Pactive® Investing

2016 was a terrible year for the performance of active stock pickers. According to Bank of America Merrill Lynch, 81% of US Large Cap active funds underperformed their benchmark1. Although we doubt that stock pickers will continue to underperform quite as badly as they did last year, investors seem to be waking up to the […]

REDWOOD BLOG | Mar. 6, 2017

Canadian Banks Deliver

by Gareth Watson, CFA Over the past two weeks Canadian banks reported their fiscal first quarter earnings which covered results from the months of November to January. All banks beat expectations, and some beat them handily. We observed the following from the bank results: Loan loss provisions remained steady for the most part and in […]