American Exceptionalism

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Research

Vanguard - Improving investing outcomes by minimizing investor bias (5 pages)

Vanguard explores how three common biases (loss aversion, recency bias & first impression bias) may impact how investors think about, recall, and act on performance perceptions.

Robeco - Leveraging the Low-Volatility Effect (13 pages)

While low-volatility stocks tend to lag during prolonged bull market, Robeco shows that using leverage can help address this issue.

Acadian - Concentrated Equity: Practice Versus Premise (12 pages)

Acadian analyzes a group of concentrated strategies to see if they outperform as a group.

RCM Alternatives - The History of Managed Futures (16 pages)

RCM Alternatives walks through the history of managed futures since the 1800s. They cover the amazing story of the Turtle Traders, what can be learned from the rise and fall of managed futures legend John W. Henry, and where the industry stands today.

Facts & Figures

Pink Floyd has agreed to sell their recorded-music and name-and-likeness rights to Sony Music for ~$400 million. Sony has spent more than a billion dollars on catalogs from Bruce Springsteen, Bob Dylan and Queen’s non-North American rights in the past few years. Link

Less than 10% of startups in 1995 had a common venture capital firm, compared to over 50% by 2018. Link

Americans are sitting on an estimated $27 billion in unused gift cards, with the average person holding $244 in unspent balances. Link

Dividends from the Magnificent 7 alone now represent 8% of the total for the S&P 500 index.

The total market capitalization of companies in the EU that are less than 50 years old with a market cap of $10 billion or more is $430 billion. The American population totals almost $30 trillion, almost 70x the EU equivalent. Link

"For the first time in history, the market capitalization of all active stocks in the United States is more than twice the nation’s Gross Domestic Product." Link

The US has 4% of the world’s population, roughly 25% of global GDP and 33% of global profits. Meanwhile, it accounts for more than two-thirds of the MSCI World index’s capitalization.

Foreign stocks trade at roughly half the valuation of US stocks.

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Podcasts

What Else Is Happening

• Meb Faber spoke with Vanguard's Fran Kinniry about Vanguard's entrance into private equity, the benefit of advisors and his outlook for 2025. Apple | Spotify | YouTube 

• Man Group's Henry Neville read his piece, Against Apathy on the Best Investment Writing podcast. Apple | Spotify | YouTube

• Did you miss last week’s email?