Heavy stock concentration poses indexing problems The relentless secular bull market in tech stocks has led to structurally high index concentration. While this is an age-old market phenomenon, it still poses a challenge for fund managers and index designers, particularly with passive investing having added fuel to the debate around index concentration.
Stablecoins come under increased scrutiny For an asset type often regarded as a “safer” corner of the crypto world, stablecoins have attracted a surprising degree of regulatory scrutiny. While stablecoins are designed to maintain a stable value, their underlying structures and use cases vary, meaning not all stablecoins are created equal. Regulators are
Regulators take aim at greenwashing Greenwashing – a misleading or deceptive marketing practice used by companies and other organizations to portray themselves or their products and services as environmentally friendly or sustainable – has become so ubiquitous in recent times that regulators have been forced to act. The EU’s proposed “green claims” directive is
Can rotation into small caps be sustained? July saw a dramatic rotation in the US stock market out of all-conquering megacap tech stocks into small caps. While a market rebalancing would be welcome, gathering economic and political uncertainty point to volatility ahead, which is a headwind for riskier small caps. For
AI and NVIDIA drive markets boom Since the launch of ChatGPT-3 in June 2020, AI has captured the public imagination in a manner like no technological development since the Internet. The widespread availability of ChatGPT-3 and subsequent enhanced versions, along with a constant stream of other AI products coming to
Inflation divergences: Implications for monetary policy Inflation dynamics across developed economies are diverging. US inflation data has come in “hot” so far in 2024, but inflation in Europe has eased, falling short of expectations. While the Fed is opting to look through the data for now and sticking to its guidance
ETFs – popular as ever, with increased specialization Exchange-traded funds (ETFs) are one of the major financial innovations of recent decades, their growing popularity reflected in an ever-rising share of assets under management. Global ETF assets hit the USD 10 trillion mark this year, of which the US accounts for the vast majority
Emerging risks in finance: “Tilted to the downside”? As the year-end approaches, the focus of market strategists and economists is on the risks to the global economy and markets in 2024. Key potential sources of risk for the global economy include fallout from China’s real estate crisis, commodity price volatility, persistent inflation, and ballooning
Banks Slow to Act on Climate-Related and Environmental Disclosures As momentum builds internationally for meaningful climate-related and environmental disclosures, an ECB report finds that European banks have made slow progress. Additionally, where disclosure is made, there is a marked lack of substantiation behind the figures. Europe’s banks have made little progress on climate-related and
Regulator Concern at Online Investor Vulnerability Both the European Commission and the SEC have expressed concern over the rise of “gamification” of retail investing and indications are that enhanced investor protection regulation is inevitable. It was just over a year ago that the global stock markets witnessed one of the most unusual phenomena
