Robert Merton has a long list of accomplishments, among them the most prominent is his award of the 1997 Nobel Prize in Economic Sciences for his work on the Black-Scholes-Merton model on derivatives. This work was fundamental in understanding how financial markets should price in risk and uncertainty in options markets. In a recent webcast, Dimensional Co-CEO and Chief Investment Officer Gerard O’Reilly engaged with Professor Merton on a number of subjects relating to risk, uncertainty, and ... [Continue Reading]
Dimensional Fund Advisors
Articles and resources related to Dimensional Fund Advisors.
Both Dimensional Fund Advisors and Vanguard have published their 2019 stewardship reports for investors. These reports focus on the money managers' duties, responsibilities, and actions in the corporate governance area, including board composition, executive pay, and environmental and social concerns. We want to highlight the availability of these reports and are happy to discuss them with you in more detail if this is of interest. Read them here:DFA 2019 Annual Stewardship ... [Continue Reading]
Our recommended reading today is a throwback to March 27, 2019, when we published Why We Won’t Panic Because the Yield Curve Inverted (And Neither Should You). In that post, we shared a number of reasons why we advised against reading into a yield curve inversion too deeply. One reason we cited was that while a yield curve inversion had a strong track record of predicting recessions in the U.S. over the past 60 years, the evidence internationally was less convincing. Another reason ... [Continue Reading]
The long-awaited IPO of Saudi Aramco is here and gives investors the first chance to own a piece of the world’s largest oil company. This IPO is historical in that Saudi Aramco becomes the world’s first $2 trillion company. For perspective, very few companies have ever been valued at over $1T, with Apple and Microsoft being the only two publicly traded companies to currently hold that designation. So, should investors race to grab a piece of this gigantic company’s stock? While ... [Continue Reading]
Index funds are receiving increased attention, mostly centered on the virtues of low-cost and broadly diversified vehicles for accessing stock and bond markets. In a competition in which one side’s success is another side’s loss, it’s not surprising to hear active managers railing against passive investing. Some claim that increased usage of index funds is distorting market prices. The Carlson Capital Management team firmly believes that markets continue to work and investors can still rely on ... [Continue Reading]