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📑 Research Notes for 2020-09-11
This week, we look at the tech sell off and sector rotation, the bull and bear cases for (almost) all assets, insider trading concerns, and how to categorize investment income.
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Tech selloff is start of rotation into cyclicals.
With the technology sell off this week, investors may be wondering what other sectors are moving. Fabiana Fedeli, global head of fundamental equities at Robeco, discusses the selloff in equities and where she’s finding opportunity.
A bull case or bear case for everything.
(A Wealth of Common Sense)
The federal government's accumulated debt burden is projected to be larger than the overall economy next year for the first time since 1946. Debt is expected to reach an all-time high of 107% of gross domestic product in 2023. The Congressional Budget Office expects the deficit to reach $3.3 trillion in the fiscal year ending this month. That's about 16% of GDP — a level not seen since the end of World War II in 1945.
Insider trading is rife with no regulators in sight.
In its recent study of 5,000 U.S. companies during the past two years, BAI found that 20% of the time, through its automated news, certain combinations of alerts, including stock trading, social media activity and credit default swaps, were followed by a mergers-and-acquisition announcement in five days. The ratio is triple the outcome if all anomalies were to occur randomly. So where are the regulators?
The four levels of income.
The term "income" can be useful as a overarching concept, covering all forms of periodic payments. However, investment income comes in various forms, which could benefit from separate designations. There are four primary varieties of "income," which are categorized based on their effects on an investor's capital.
Curated by Joseph Lu, CFA®
Joseph has over a decade of experience as an investment professional, primarily in quantitative analysis and portfolio management roles. He is the founder and managing director of Conscious Capital Advisors and a CFA® Charterholder. The CFA charter is a globally respected, graduate-level investment credential by the CFA Institute, a global association of more than 90,000 investment professionals working in over 133 countries.
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