In his 2018 letter to Berkshire Hathaway shareholders, Buffett wrote that stock performance converges with business performance over time if the original purchase price is not excessive. Jeremy Schwartz and Kara Marciscano make the case for our quality dividend growth strategy, with aggregate profitability that is comparable to Berkshire’s equity portfolio and a valuation below the S&P 500.
If factor investing makes logical sense—and we think it does—the way to operate an ETF business is to have conviction and reasonable fees. Using simple arithmetic, Jeff Weniger calculates the “hurdle rate,” which quantifies how well active selections need to perform to cover their expense ratios.
When it comes to low-volatility strategies, it’s important to look under the hood to determine what risks may or may not be evident. Christopher Gannatti discuses a low-volatility investing option with less valuation risk for today’s equity market.
We think investors should consider maintaining exposure to developed international equities in the current market environment. Currency hedging and small caps could be considered two important themes to help investors generate excess returns and limit downside risk across developed international markets.
After significant relative outperformance in the U.S. equity market like we have seen over the past decade, some investors begin to question the merits of maintaining their diversification. With the outperformance and the valuation advantage that now exists in developed international equities, we believe now may be the time to maintain, or even add to, a global portfolio.
Jeremy J Siegel
Senior Investment Strategy Advisor
CEO of WisdomTree
Jeremy Schwartz, CFA
Executive Vice President, Global Head of Research
Christopher Gannatti, CFA
Head of Research, Europe
Christopher Gannatti began at WisdomTree as a Research Analyst in December 2010, working directly with Jeremy Schwartz, CFA®, Director of Research. In January of 2014, he was promoted to Associate Director of Research where he was responsible to lead different groups of analysts and strategists within the broader Research team at WisdomTree. In February of 2018, Christopher was promoted to Head of Research, Europe, where he will be based out of WisdomTree’s London office and will be responsible for the full WisdomTree research effort within the European market, as well as supporting the UCITs platform globally. Christopher came to WisdomTree from Lord Abbett, where he worked for four and a half years as a Regional Consultant. He received his MBA in Quantitative Finance, Accounting, and Economics from NYU’s Stern School of Business in 2010, and he received his bachelor’s degree from Colgate University in Economics in 2006. Christopher is a holder of the Chartered Financial Analyst designation.
Head of Fixed Income Strategy
Tripp Zimmerman, CFA
Head of Fixed Income & Currency
Associate Director, Asset Allocation and Modern Alpha
Head of Capital Markets
Associate Director of Capital Markets
Head of Europe
Joseph Tenaglia, CFA
Associate Director, Asset Allocation
Jianing Wu joined WisdomTree as a Research Analyst in October 2018. She is responsible for analyzing market trends and helping support WisdomTree’s research efforts. Previously, Jianing completed internships and projects at Geode Capital, Starwint Capital, and Invesco Great Wall Fund Management with a focus in quantitative research. Jianing received her M.S in Finance from the Massachusetts Institute of Technology. She graduated with honors from Boston College with degrees in Mathematics and Philosophy.
Jeff Weniger, CFA
Director, Asset Allocation
Alejandro Saltiel, CFA
Associate Director of Modern Alpha
Alejandro Saltiel joined WisdomTree as a Quantitative Research Analyst in May 2017. He is responsible for quantitative research on WisdomTree’s products and global equity markets. Prior to joining WisdomTree, Alejandro worked at HSBC Asset Management’s Mexico City office as Portfolio Manager for multi-asset mutual funds. He started his career working at a boutique hedge fund that specialized on trading options on sector-levered ETFs. Alejandro received his Master’s in Financial Engineering degree from Columbia University in 2017 and a Bachelor’s in Engineering degree from the Instituto Tecnológico Autónomo de México (ITAM) in 2010. He is a holder of the Chartered Financial Analyst designation.
Matt Wagner, CFA
Modern Alpha Analyst
Matt Wagner joined WisdomTree in May 2017 as a member of the Research team. He is responsible for research on WisdomTree’s products and communicating the firm’s views on the markets. Matt started his career at Morgan Stanley, working as an analyst in Treasury Capital Markets from 2015 to 2017 where he focused on unsecured funding planning, execution and risk management. Matt graduated from Boston College in 2015 with a B.A. in International Studies with a concentration in Economics. Matt is a holder of the Chartered Financial Analyst designation.
Investment Strategy Analyst
Brian Manby joined WisdomTree in October 2018 as an Investment Strategy Analyst. He is responsible for assisting in the creation and analysis of WisdomTree’s model portfolios, as well as helping support the firm’s research efforts. Prior to joining WisdomTree, he worked for FactSet Research Systems, Inc. as a Senior Consultant, where he assisted clients in the creation, maintenance and support of FactSet products in the investment management workflow. Brian received a B.A. as a dual major in Economics and Political Science from the University of Connecticut in 2016, and is pursuing the Chartered Financial Analyst designation.
Ryan Krystopowicz, CFA
Associate, Asset Allocation
Ryan Krystopowicz joined WisdomTree in March 2016 as a member of the Distribution Team and has transitioned over to the Asset Allocation Team as a Product Specialist, ETF Model Portfolios. He is responsible for maintaining and delivering data and content associated with WisdomTree Model Portfolios. Ryan also supports model development and decisions, as well as contributes to the commercial success of Model Portfolios by supporting the sales and client solutions team. He started his career at a Registered Investment Advisor working as Research Analyst and Assistant Trader. Ryan received a degree from Loyola University of Maryland and is a holder of the Chartered Financial Analyst designation.
Kara Marciscano, CFA
Quantitative Research Analyst
We’ve written a lot recently about what it means to focus on quality in equity investments. The third quarter of 2015—with the volatility that it brought along with it—provided what we think was an interesting short period to illustrate the benefits of a quality approach.
WisdomTree has been constructing fundamental rules-based indexes for almost a decade on the premise that markets are not always efficient, and so stock price may not be the best determinant of fair value. Consequently, we believe that screening various markets by their fundamentals and reweighting those securities by their fundamentals, instead of price, on a periodic basis can potentially improve risk-adjusted returns.
The large-cap value investment style is one of the most popular styles among U.S. investment managers. Intuitively, this makes sense, as it involves following large, well-known companies in an attempt to see when their share prices dropped below what would be justified by their fundamentals. But large-cap value isn't the only investment style there is.
Quality Discussion within equity investing has a long history. Warren Buffett, Benjamin Graham, Kenneth French and Eugene Fama all implemented criteria focusing on quality.
We believe companies with a long history of dividend growth may not be the key drivers of tomorrow’s dividend growth and that it’s necessary to be more dynamic in the selection criteria to capture the current shifting trend in the U.S. dividend market.