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Dividend investing is one of the oldest and most popular strategies amongst retail and institutional equity investors on Wall Street. Legends like Warren Buffet and Benjamin Graham are well known advocates of this value investing approach, and their success in the financial markets speaks volumes about this timeless strategy. Research conducted by Standard & Poor’s revealed that dividend components were responsible for 44% of the total return in the last 80 years of the S&P 500′s history. To put this into perspective, consider the following: an investment of one dollar, from 1950 to 2010, with dividends and reinvestment of those proceeds, would have performed eight times better than a dollar invested in a similar, but non-dividend paying, security. Clearly, investing in dividend paying companies has proven to be a formidable strategy in times of both prosperity and economic downturns, showcasing the versatility of this simple, but effective, investment strategy. [click to continue…]
Equity markets got off to a stronger than expected start this week as investors refrained from selling, and instead stepped in to buy up stocks on the cheap and push domestic indexes higher off last week’s lows. Wall Street rallied on Wednesday after a positive durable goods report boosted investor’s sentiment as orders rose by [...]
The ETF industry’s strong growth in recent years has led to innovation across the board. Now, investors can find products that offer exposure to nearly every corner of global markets through a single ticker. And while many of these new options have been welcomed with open arms, investors have been wary of others. One space [...]
Equity markets struggled to pick a direction last week, fluctuating between small gains and pesky losses one day after the other. Late in the week, however, worse than expected economic data on the home front and escalating European debt woes managed to push the markets of a cliff one more time, with equity indexes sinking [...]
In recent years, ETFs have become increasing popular tools for accessing the fixed income corner of the market. The space initially grew much more slowly than equity ETFs, but investors have gradually become more comfortable with the combination of fixed income exposure and the exchange-traded structure. Innovation in the bond ETF space has been impressive [...]
Bond giant PIMCO expanded its ETF lineup to 14 products last Friday, rolling out its first ETF to offer exposure to high yield bonds. The PIMCO 0-5 Year High Yield Corporate Bond Index Fund (HYS) will seek to replicate the BofA Merrill Lynch 0-5 Year US High Yield Constrained Index. HYS joins nine other PIMCO [...]
While many of the “first generation” of ETFs offered exposure to widely-followed equity indexes, the universe of exchange-traded products has expanded at a tremendous pace in recent years to include more than 1,200 ETPs across a number of different asset classes. More and more investors have embraced the exchange-traded structure as a vehicle for achieving [...]
Actively managed ETFs have been slow to gain traction so far among most investors for a variety of reasons. Higher than average fees, a boatload of academic evidence suggesting inability of active management to consistently generate alpha, and concerns about disclosure requirements leading to front-running opportunities have all contributed to the relatively slow adoption rate [...]
The last few years have seen tremendous growth in ETF assets, as investors have gradually embraced the exchange-traded structure as a tool for establishing exposure to everything from emerging markets to micro cap stocks to commodities. Interest in bond ETFs has been particularly strong; according to year-end data from the National Stock Exchange, bond ETFs [...]
Creativity on the product development front has become a defining characteristic of the ETF industry, as the surge in the number of ETF offerings in recent years has been driven not by duplication but by innovation. Many of the new fund launches are first-to-market concepts, offering exposure to asset classes or strategies not previously available [...]
Russell Investments and Research Affiliates announced this week the creation of a new suite of indexes based on the Fundamental index methodology developed by Research Affiliates founder Rob Arnott. The two companies formed a partnership last year, and are now introducing 24 fundamental-weighted benchmarks measuring the performance of domestic and international equity markets.
