How does free float impact the performance and other characteristics of global equity benchmarks?  We examined changes in free float over the last 20 years and found that increases have led to positive price impacts, and vice versa.  

Attendees at the recent MSCI Canadian Institutional Investor Forum discussed and debated the challenges and opportunities created by massive structural, macroeconomic, societal and technological shifts in the investment landscape.

While the share of U.S. technology firms with a substantial drawdown has risen fast, it is not yet at the level of the early-2000s technology crash. It is, nonetheless, worth examining what lessons we might pull from the wreckage of that time.

How can investors incorporate transformative, but volatile thematic investments while seeking to control for valuation and total and active risk? We examine three approaches that improved a portfolio’s “innovation profile” with modest changes to risk.

Can we quantify home-bias risk in an allocation? And, what has happened when U.S. stocks ended previous multiyear runs of outperformance?

The recent 40% drop in the Turkish lira is part of a long-term trend of rising emerging-market currency volatility. Typically, investors do not hedge this exposure. Is it time to reconsider this approach?

Over the last five years, the risk and return profile of emerging markets has started to resemble that of developed markets. That leaves many large asset owners to ask how to structure mandates to take advantage of the variation in the behavior of emerging markets.

U.S. equity investors in 2016 experienced a roller coaster ride. The U.K.’s vote to leave the European Union and the U.S. presidential election each resulted in sharp market moves. Together, the two events contributed to a shift in the underlying fabric of equity markets starting in the second half of the year.

Pro-cyclical factors are in, defensive factors are out. That, in a nutshell, describes how the U.S. equity market has responded to the presidential election.

Among the reasons that value firms sell at a discount to their intrinsic worth is that they tend to be more sensitive to shocks in gross domestic product compared with their growth counterparts. That may occur because of leverage, deployments of capital, risk-taking or something else that constrains value firms' abiliity to adapt to macroeconomic stresses.

With the U.S. Federal Reserve expected to raise interest rates before the end of the year, institutional investors are focused on how an increase may impact their portfolios, including how different equity style and industry factors perform in different interest-rate regimes.

Apart from a recent swoon spurred by fears that the U.S. Federal Reserve could raise rates, it has been a summer of love for investment in emerging markets.

Emerging-market equities revived in the first quarter after a rather dismal performance over the past five years. The pickup has left investors to wonder whether the gains might continue and to think anew about how to approach the segment.

Despite agreement on the principles of value investing, the investment community uses a number of different metrics to describe the value factor. Each metric (or descriptor) has its own advantages and pitfalls.

U.S. cap-weighted, small-cap benchmarks have historically displayed structural biases that affect performance. For example, small-cap indexes have sector, revenue and style tilts compared to the broad U.S. market.

Many institutional investors recognize that their reference universe should include large-, mid- and small-cap equities and that smaller companies should earn a risk premium over larger ones. In practice, however, many of these investors - particularly in Europe and Asia - underweight the small-cap segment.

Investors have long debated the benefits of active versus passive investing. There are institutional investors with strong convictions in each camp, but many have become increasingly pragmatic, combining active and passive mandates in pursuit of the best risk-adjusted return.

Factor indexes historically have generated premia in developed markets. Now, as global markets have become more correlated, investors are starting to seek additional sources of returns within emerging markets.

Equity factor investing aims to capture exposures to different equity risk premia. Factor modeling and factor investing are rooted in the Capital Asset Pricing Model (CAPM) dating from the mid-1960s, Arbitrage Pricing Theory from the 1970s and Fama and French’s three-factor model from the 1990s.