Top stories
Our latest news, research and insights.
Foresight Landscape Report – Emerging Market Funds in Australia – 31.03.2017
Key Insights UN PRI and UN SDGs provide strong encouragement and a defined framework for investors to assess impacts of their investment decisions including carbon emissions and its impact on climate. Australia has the highest per capita greenhouse gas emissions in...
Foresight Global Small Cap Factor Report
Gobal small cap represents a strong growth opportunity within the global equity markets according to our latest market factor report. This attribute is driven by several factors including 5-year earnings growth (4.8 standard deviations higher), sales growth (8.4 standard deviations higher) and IBES earnings long-term growth (8 standard deviations higher)….
Foresight Australian Ex-Top 20 Factor Report
The Australian X20 (outside top 20 companies by market cap) segment of the market represents a strong value and growth (GARP) opportunity according to our latest market factor report. Value factors that stand out relative to the broader market include shareholder yield (3 standard deviations higher,) EBITDA to EV (2 standard deviations higher) and book yield (1.6 standard deviations higher).
Foresight Australian Small Cap Factor Report
Australian small caps (X100 stocks by market cap) represent a strong growth opportunity in the Australian share market according to our latest factor report. Importantly, the growth drivers in this segment of the market are not financially levered. Valuation on the…
Factor Rotations: Evidence from global equity markets
Developed Markets There has been quite a bit of style rotation going on in global markets since 2016. After a strong relative performance from value factors in 2016, growth factors have been the driving force in developed markets so far in 2017. Return premiums have…
Industry Intelligence: Australian Funds Management Industry
Australian funds management industry experienced an increase by $24.5 billion to $1.68 trillion in the first quarter of 2017. Total assets under management for discrete mandates grew significantly, accounting for the biggest share of the market. Meanwhile, the…
Smart beta may not be so smart: risk diversification or risk amplification
Over the last few years, we have witnessed the proliferation of smart-beta and factor-tilting strategies. These strategies can play an important role in portfolios but investors need to understand the nature of risk introduced by these strategies. Our analysis of a…
Active Managers Deliver: Evidence from the Australian Micro-Cap Sector
Active Managers Deliver: Evidence from the Australian Micro-Cap Sector Foresight’s latest analysis of the Australian equity strategies reveals some interesting insights. While the big-caps have done very well over the past 10 years, Micro and Small caps have delivered…
Global Equity Market Environment Review
Our latest review of the global equity market shows continued leadership from emerging and frontier markets. Eastern European markets such as Bulgaria, Austria and Poland delivered stellar returns in excess of 40% over the past 12 months. From a global sector…
Super Industry Intelligence: ATO regulated SMSFs continue to outpace system growth
Based on the ABS and ATO data-sets, the Australian managed funds industry represented $2.8 trillion assets at 31st March 2017. This was almost 9% higher than the same period last year. Superannuation segment still took the biggest share with asset under management of…
FAANGs and Fundamentals – Part 1
A lot has been written about FAANGs in recent times. These fast-growth companies have outperformed their industry peers and the broader market in recent years as their market capitalisations have soared. They’ve led mega-caps to outperform and masked much of the…
Emerging market sweet spot: high returns, low volatility and falling correlations.
By Jay Kumar and Frederick Do, September 2017. Over a 12-month period to 31 August 2017, global emerging markets equity returned 16.9%, placing it amongst the highest returning market segments in the world. The spectacular return was driven by Asian region with 18.9%,…
How to reduce fund selling, hiring and firing mistakes by using factor insights?
By Jay Kumar, September 2017. In a crowded market of active management, investors need to focus on unique drivers of alpha and assess their sustainability through a complete investment cycle. The recent proliferation of passive ETFs, fundamental-indexing and…
Realised factor premiums much stronger in Emerging markets
Global Developed markets experienced notable reversals in factor premiums since December 2016. So far in 2017, Value style factors recorded negative premiums while Growth and Momentum style factors delivered positive premiums. The YTD factor premium experience is…
Do active managers in Emerging Markets add Value?
Key Points Emerging Markets (EM) have been outperforming Developed Markets (DM) and this trend is likely to continue given the fundamental backdrop. Factor premiums across EM have been very strong and broad-based. Intra-market correlations between EM countries have…
Global Listed Infrastructure: Active Strategies to offer better downside protection going forward
Global listed infrastructure investors have earned very healthy returns over the past decade. Despite increasing allocations in the past decade, the asset class is still under owned by many Superannuation funds. Strong secular returns have been underpinned by earnings…
Growth, Quality and Momentum factors drive world equity market returns
Global Equity – Developed Markets. Growth momentum and quality factor premiums highly persistent over 3, 6 and 12 months Value factors underperform, led by dividend yield and earnings yield Medium-term Momentum recorded the highest positive premium globally over the…
Global Small Caps provide a rich source of idiosyncratic growth for global equity portfolios
Despite the high certainty of global small caps out-performing global large caps (aka the ‘small cap effect’) over the long term, Australian institutional and wholesale investors have been reluctant to allocate equity capital outside the global large caps and global…
Growth assets outperform, weak Australian dollar boosts unhedged asset returns
Key Insights UN PRI and UN SDGs provide strong encouragement and a defined framework for investors to assess impacts of their investment decisions including carbon emissions and its impact on climate. Australia has the highest per capita greenhouse gas emissions in…
GREITs Landscape Review – Outlook for institutional allocation positive but caution warranted on active managers
Key Insights Superannuation asset allocation towards listed and unlisted real estate has steadily increased since 2013. Retail funds have the highest exposure to GREITs, aging demographic profiles of several non- retail funds is expected to increase the demand for…
Carbon Scorecard for Global Equity Portfolios
Key Insights UN PRI and UN SDGs provide strong encouragement and a defined framework for investors to assess impacts of their investment decisions including carbon emissions and its impact on climate. Australia has the highest per capita greenhouse gas emissions in…