From time to time, we publish in-depth papers discussing our views on issues and
topics that are closely related to our investment style. To read recent papers,
click on the links below.
The Future for Growth Stocks – The Change Has Begun (3Q07 Update)
Large Cap Growth stocks are leading most asset classes this year after
having suffered almost seven calendar years of underperformance1. In
relation to their counterparts in Large Cap Value, Growth stocks prior
to this year had seen a period of underperformance not seen since the
Russell Style Indices were first introduced. Sentiment is slowly
changing and has moved away from the extremely negative view on
the Large Cap Growth style of investing that was prevalent in the
2001-2006 period.
The Equity Risk Premium - Implications and Conclusions
The Equity Risk Premium (ERP ) is the framework by which
long-term equity return expectations are based and helps set
investors' asset allocation decisions. Historically, opinions about
the future long-run returns on equities have been vastly
different. In theory, equities should return more than any riskfree
asset (U.S. Government Bonds) due to the inherent risk in
investing in equities. This risk is derived from not having any
guarantees as to when dividends or income is received and/or
when (or if) one will ever see a return on their original
investment.
