BCA Indicators/Model
The equity risk premium (ERP) allows investors to assess the additional compensation they are offered as an enticement to assume equities’ incremental risk. The ERP measures equities’ excess return by deducting the inflation-linked 10-year yield from the…
According to BCA Research’s Counterpoint service, job losers not on temporary layoff (‘bad’ unemployment) will need to rise further for the Fed to reach its 2 percent inflation target. Although prime-age participation has surged, the participation of older…
We continue to expect a recession by early 2025 but assign non-trivial odds to growth surprising to the upside until then. Our Global Investment Strategy team thus recommends investors adopt a barbell equity strategy as a hedge for the second half of 2024,…
Earlier this year, WTI oil prices peaked on April 5th at $87.69 per barrel. They have since corrected by 12.7%. Should asset managers expect this decline to continue? Our Global Investment Strategy team believes oil prices could see some upside over the…
The ECB is now firmly in easing mode, even if it refuses to pre-commit to a specific rate path. What does this data dependency mean for the euro and European yields?
BCA’s Global Leading Economic Indicator has had a good track record of predicting year-on-year changes in the IMF global real GDP growth series. This GDP-weighted average of the standardized leading indicators of 23 DM and EM economies bottomed in early 2023,…
Healthcare has underperformed the S&P 500 by 23% since early 2023. Profit margins have been squeezed since the pandemic revenue windfall dried up and because long-term contracts prevented companies from raising prices in line with increasing costs.…
The silver-to-gold ratio has surged close to 10% this year on the back of silver prices catching up to gold. Silver has returned 22% on a YTD basis, against 12% for gold, 13% for industrial metals and 5% for the broad commodity complex, making the white metal…
According to BCA Research’s US Bond Strategy service, Mortgage-Backed Securities are currently priced below fair value. Mortgage-Backed Securities outperformed the duration-equivalent Treasury index by 49 basis points in May, bringing year-to-date excess…
BCA developed the Debt Supercycle thesis in the 1970s to characterize the postwar surge in private sector indebtedness. Because rising debt burdens increased economic vulnerability, policymakers were forced to pursue increasingly reflationary measures after…