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Over the past three years, investor behaviour in Europe has undergone a marked shift, with a growing preference for ETFs over actively managed funds. Data from Lipper reveals nearly €500 billion in outflows from actively managed strategies, primarily from equity funds, during this period. At ECP, we see this as a compelling opportunity for stock … Continued
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Today’s analysis focuses on the relationship between the cyclically adjusted P/E (CAPE) of the S&P 500 and the inflation-adjusted returns of the index over the following 10 years. Historically, whenever such normalized valuations have reached current levels, the subsequent decade of returns for the S&P 500 has been either low or negative. If history serves … Continued
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ASML Holding NV, Europe’s largest tech company, saw its shares plummet 15.6% after reporting earnings that revealed order bookings were only half of what analysts had expected. There’s no denying that ASML is a remarkable business, developing cutting-edge technology to build the world’s most advanced chip-making machines, which are in high demand thanks to the … Continued
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This year, BlackRock’s assets under management have soared past $11.5 trillion—an amount exceeding the combined totals of the Federal Reserve’s balance sheet, the U.S. Social Security Trust Fund, and the U.S. Thrift Savings Plan. With such immense financial clout, BlackRock’s investment decisions not only move markets but also significantly influence the global economy.
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Profit levels and margins for European companies have barely returned to their pre-2007 levels, while U.S. companies have seen their profits surge by 150%, accompanied by a significant expansion in margins. The valuation premium and multiple expansion of U.S. equities is well-justified by the fact that American companies have outperformed their European counterparts since the … Continued
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Valuation is crucial—both historically and statistically. Research from Bank of America (BofA) shows that 80% of equity returns over the next decade can be traced back to the valuation at the time of investment. This study, based on data from 1987 to the present for the S&P 500, underscores the long-term importance of entry price, … Continued
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In July 2024, a remarkable event unfolded in stock market history: the combined market capitalization of the top 10 stocks in the S&P 500 briefly surpassed that of the remaining 490. However, this dominance was disrupted when the unwinding of the yen carry trade primarily impacted Big Tech companies. Since then, the top 10 stocks … Continued
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Exor, the Agnelli family’s holding company, is often seen as primarily tied to mass-market automotive through its stake in Stellantis (Fiat and Chrysler). However, its largest asset is Ferrari, a luxury brand that extends beyond the automotive sector. In fact, Exor’s exposure to mass-market automotive through Stellantis represents only 13% of its gross asset value … Continued
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Oil extended its rally for the third consecutive day as markets weighed the escalating supply risks in the Middle East. Israel is anticipated to retaliate against Iran following Tehran’s recent missile offensive. Brent crude is nearing $75 a barrel, marking the longest streak of daily gains since August. A large-scale Israeli strike on Iran’s oil … Continued
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Today, the “Magnificent 7″—Microsoft, Apple, NVIDIA, Amazon, Alphabet, Meta, and Tesla—account for 31.3% of the total market capitalization of the U.S. stock market. This is a considerable increase compared to the 19% share held by the top 7 tech companies at the height of the dot-com bubble. However, there is a key distinction: today’s tech … Continued