Gavekal Capital: Beta was the driving factor last week for performance but Dividend Yield galvanizing returns over the past year

Monday, October 21, 2013

Beta was the driving factor last week for performance but Dividend Yield galvanizing returns over the past year

Last week with most of the attention being on whether or not the US Government would be able to get a deal done to raise the debt ceiling and fund the government, the factor with the highest R-square performance was Beta. Beta has played a prominent role over the past 3 months as well (second highest correlation behind T-Bond Yield Curve, respectively).

Last week's top 5 factors with the highest R-Square

Over the past 3 months the top 5 factors with the highest R-Square

However, over the past year valuation metrics have shown a greater relationship to performance with Dividend Yield (DY) and P/E, two of the three highest R-square values during this time.

About Gavekal Capital

Gavekal Capital is a US registered investment advisory firm that manages the Gavekal Knowledge Leaders Strategy. Knowledge Leaders are a group of the world’s leading innovators with deep reservoirs of intangible capital. These companies often possess competitive advantages such as strong brand, proprietary knowledge or a unique distribution mechanism. Knowledge Leaders are largely service-based and advanced manufacturing businesses, often operating globally. Gavekal Capital seeks to identify the world’s leading knowledge companies through a proprietary process that analyzes corporate knowledge investments.
We offer the Gavekal Knowledge Leaders Strategy in multiple products for global investors. For more information about our product offerings please visit http://www.gavekalcapital.com.
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