Insights


Podcast: Inside the Mind of a Quant, Part 2

Glossary

Dividends: A dividend is the distribution of reward from a portion of the company's earnings and is paid to a class of its shareholders.

Emerging Markets: 23 emerging economies: Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Peru, Philippines, Poland, Qatar, Russia, South Africa, Taiwan, Thailand, Turkey and the United Arab Emirates.

Environmental, Social and Governance (ESG) Investing: Incorporates an analysis of ESG credentials into the decision to invest — in addition to traditional financial metrics. It can also encompass efforts by investors to influence the activities of the companies within investment portfolios through voting and engagement, either directly or by an investment manager on the investor's behalf.

Factors: Factor investing is an investment strategy in which securities are chosen based on attributes that are associated with higher returns. Factor investing requires investors to take into account an increased level of granularity when choosing securities; specifically, more granular than asset class.

Frontier market: A frontier market is a type of developing country which is more developed than the least developing countries, but too small to be generally considered an emerging market. The term is an economic term which was coined by International Finance Corporation’s Farida Khambata in 1992.

Micro: Microeconomics refers to more individual or company specific studies in economics. How businesses establish prices, how taxes will impact individual decision making, the concept of supply and demand. So Microeconomics looks at all the small economic decisions and interactions that all add up to the big picture concepts that Macroeconomics looks at.

Macro: Macroeconomics is a branch of economics dealing with the performance, structure, behavior, and decision-making of an economy as a whole, as opposed to individual markets.

Per Capita GDP: Per capita GDP is a measure of the total output of a country that takes the gross domestic product (GDP) and divides it by the number of people in that country. The per capita GDP is especially useful when comparing one country to another, because it shows the relative performance of the countries.

Quality: Quality has long been established as an investment approach, dating back to Benjamin Graham, but it is less well accepted as a factor, especially when compared with value, size, yield, momentum and low volatility. Quality is defined by low debt, stable earnings, consistent asset growth, and strong corporate governance. Investors can identify quality stocks by using common financial metrics like return to equity, debt to equity and earnings variability.

Signal: A term used interchangeably with Alpha, is a measure of performance, the excess return of an investment relative to the return of a benchmark index.

Valuation: A valuation is the process of determining the current worth of an asset or company.

Disclosures

Important Risk Information

The views expressed in this material are the views of Chris Laine through the period ended May 6, 2019 and are subject to change based on market and other conditions.

This document contains certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected.

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