American Century

Best Blogs of the Week #226

Posts from five different blogs in this week’s best. Some big picture (Wells Fargo), others making the case for professional money management implicitly (BlackRock), and others getting pretty technical, in the most helpful way (American Century).

American Century – CIO Insights: Oversold Conditions Opened Select Opportunities in High-Yield – During the last five years, we’ve seen two distinct high-yield spread spikes associated with risk-off financial market trading. The first was in October 2011, during the European sovereign debt crisis, when spreads soared above 900 bps. The second was in February 2016, when spreads again approached 900 bps. These periods of spread widening were accompanied by corresponding bond price corrections. In the most recent occurrence, we believe too much worst-case scenario sentiment was priced into the high-yield market, given our analytical view that China will avoid an economic “hard landing” and the U.S. will avoid recession.

BlackRock – 3 themes that will shape markets this quarter – The investing takeaway of this third theme: Investors can no longer rely on a rising tide lifting all boats. Security selection is crucial as dispersion re-emerges in asset markets.

Wells Fargo – In volatile times, a case for quality investing– We’ve explored how five different investment styles have performed during periods of high and low volatility throughout history: growth, momentum, value, minimum volatility, and quality.

William Blair – Why We Remain Cautious in Emerging Market Currencies – … our analysis shows that fundamentally attractive currencies are predominantly in the emerging world and the unattractive currencies are predominantly in the developed world.

WisdomTree – Dividend-Weighted Indexes Crush the Market in Q1 – I think there are three basic reasons why dividend stocks performed so well in the first quarter of 2016.