Smart Beta Rotation Can Provide Alpha

While research has generally supported that systematic momentum and value tilts applied to multifactor portfolios can generate excess risk-adjusted returns, the benefits do not come without the potential introduction of significant tracking error.

With the expectation that we will see more factor rotation strategies in the market in 2017, we think it is important to evaluate the magnitude of this potential trade-off.

Updating Investor Targeting to Capitalize On New Market Trends

Direct investor targeting has always been an essential part of a successful investor relations program. Updating your institutional investor target list each year is great way for companies to capitalize on changing market trends, economic developments, and keeps your prospects list from going stale. StarHub is an fine example of a firm that refreshes its IR institutional target list each year based on the latest company developments and investor preferences. Read more on StarHub's dynamic IR investor targeting program and how your firm might benefit from an annual institutional investor target list refresh at IR Magazine.

Positive Investor Sentiment Has Stabilized; Awaiting The Next Catalyst

As 2016 wraps up with a new President-elect and an interest rate hike with likely more to come, how are investors thinking about and positioning within the Technology sector? 

Corbin Perception's final Tech Sentiment Survey of 2016 finds sentiment remains generally positive as investors recharge and await the next catalyst. While global capex concerns linger, respondents largely expect most key metrics to stay the same or improve and are casting a cautiously optimistic eye toward future tax reform. Still, bulls won't be fully charged until the Tech IPO market recovers, largely expected in 1H17.

Their survey identified some interesting investment themes, including predicted winners and losers among bellwethers.

While investors anticipate a glitch in Tech valuations amid an anticipated President-elect Trump reboot of global trade agreements, the U.S. economic outlook is neutral and outright optimistic for equity markets. 

Read the report

How to rebuild shareholder confidence following challenging times

"There couldn’t be a better time to increase access to management than during and after a challenging period'.

The investor landscape presents many opportunities for demanding times, which can negatively affect shareholder confidence. Not only are companies vulnerable to general market challenges – including regulation, commodity pricing and political implications – but company-specific threats, such as ESG issues, shareholder activism and employee negligence can also all have a detrimental effect on market perception.

IROs can play a vital role in rebuilding shareholder confidence following difficult periods, with one key tactic being to facilitate greater access to management….https://www.irmagazine.com/articles/corporate-access/

Key Factors that Drive ETF Investor Decisions

The ETF.com fourth-annual ETF investor survey comes at an interesting time for the ETF industry. This year has seen a healthy number of launches and a record number of ETF closures, while total assets continue to grow. ETF.com has again polled their sophisticated readership to learn their opinions on the leading issues faced by ETF investors today.

And once again ETF.com has partnered with Brown Brothers Harriman—a leading provider of asset-servicing for the global ETF market, with $340 billion in ETF assets under custody as of June 30, 2016—to update the survey to reflect the most relevant core topics and emerging new concerns, arriving at a comprehensive questionnaire of more than 35 questions.

They’ve gathered the results, and the following is a summary of the findings.

Can Paid-For Micro-Cap Research Have Value for Investors? OTC Markets is Betting It Does

It’s hard out here for a small cap. Despite being the primary driver of job growth in this country, Wall Street’s smallest firms have the most trouble getting the public markets to work for them. Aside from the tremendous costs associated with being a public company, small- and microcap companies have to further deal with an increasing lack of attention. Despite offering the biggest potential returns, smaller companies tend to be shunned by large and small investors alike because of the perception that small- and micro-cap stocks are too risky.

At the core of this issue is a lack of information. Sure, smaller companies generally carry more risk for investors and display more volatility, but they more than balance that out with the potential for much larger returns than exist in larger, more established companies. When part of a balanced, diversified portfolio, they can be invaluable. But they also lack the sort of prolific and detailed research reports that are usually readily available for larger public companies. Even for investors interested in taking on a little more risk in search of big returns, doing so without having access to the sort of expert opinions and research analysis they’re accustomed to is a non-starter.

Should you pre-record your earnings call?

Although it is still something of a rarity, some companies today release pre-recorded earnings calls. Traditionally, management reads out scripted comments live before diving into the Q&A. But with pre-recordings, the scripted comments are taped in advance. They can be released immediately before the Q&A or further in advance. Some companies even do away with the live Q&A and simply post pre-recorded comments.

Franklin Templeton Investments, for example, provides its pre-recorded comments via dial-in replay and audio webcast at the same time its earnings press release is filed. It then follows that up with a live Q&A call two-and-a half hours later. Other firms that utilize pre-recorded earnings comments include Walmart and Sears Holdings. Below we outline some of the pros and cons to help you decide if it is right for your IR program.

The 4 Multimedia Horseman of IR

IR Magazine recently published a Global Investor Relations Study on the use of multimedia in IR communications. The research focuses on the four main multimedia formats used in IR communications: audio webcasts, video webcasts, corporate video and infographics. The results of survey questions answered by 797 respondents analyzes the findings globally, by region and market cap.

Key findings:

-Audio webcasts are the most used and considered the most useful multimedia format for IR.

-Corporate video and infographics have seen the greatest growth in use over the past three years.

-Webcasts are primarily used for results presentations. Use of corporate video and infographics is more varied, including corporate publishing, presentations and investor events.

-IR practitioners see video as a way of personalizing the company for investors and bringing the company’s operations to life.

-Almost a third of IR practitioners have received feedback from investors about their use of multimedia.

Read the full report here.

Best Practices for IR Following an Earnings Call

Ipreo’s “Hot Topics” publication delivers relevant information directly from the investment community regarding trends impacting the IR industry.  As many of our clients have inquired about best practices for interacting with investment managers following an Earnings Call, for our June edition of Hot Topics we interviewed and surveyed investors managing over $2.43 Trillion in equity assets on this exciting topic.

We found that the majority of investors mentioned that they prefer to touch base with IR themselves after the call.  However, it is important to note that many investment managers mentioned that a proactive IR team cannot hurt, especially surrounding an abnormal event. 

Investor feedback on best practices for IR following an Earnings Call:

• “If IR reached out to me that would be great. One thing I find helpful and effective is pre-arranged CFO call backs following earnings calls. Thirty minutes is all that’s needed.”

• “I prefer a more proactive practice. I follow around 100 companies so it can be difficult to follow up with everyone.”

• “I’d rather just be able to reach out to the IR team on my own.”

• “I do not see the need for them calling me unless it is an invitation to an event or something similar.”

• “I don’t feel IR has to reach out individually after every earnings report. However, when something unusual happens, I would appreciate a call from IR.”

• “Following an earnings call, I prefer IR teams to reach out proactively, I think that’s great."

The full report can be found here.

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