THE WisdomTree BLOG
The stock market peaked in September, but the exodus out of ETFs and into mutual funds that some active managers are hoping for may not materialize. Jeff Weniger talks about the effects of market volatility on different investment vehicles.
Until recently, the FAANG stocks have been unstoppable, like the antagonist in the classic 1984 movie The Karate Kid. Is it time for Daniel-san to crane kick the FAANG stocks?
When your starting point is a 1.4% dividend yield, as is the case with the S&P 500 Growth Index, the group of stocks that makes up the basket had better have long-term dividend growth that performs like Seabiscuit, the super horse. No tripping out of the gate or getting bumped in the stretch. Everything must go perfectly.
At the risk of making a 34-year-old pop culture reference, growth stock fundamentals recall the question first posed by Wendy’s: “Where’s the beef?” As was the case in 1984, when war was declared on McDonald’s and Burger King, there appears to be a lot of “bun” in the U.S. growth stock story, but not a lot of “meat” in their valuations.
Does the “global trade war,” quotation marks intentional, spell doom? It depends on your silo. While the mass of investors focus on this issue, few are noting Chinese fiscal expansion or, for that matter, big trade deals being signed right now.