News & Insights

Non-U.S. equities faced meaningful headwinds in a quarter of political intrigue among some of the world’s most critical democracies. Many central banks continued to lower short-term interest rates, reducing one strain on borrowers and the economy. At the same time, those same actions put downward pressure on currencies with only the Israeli shekel rising against the greenback in the quarter. Still, lower rates relative to the U.S. may be the driver of value recognition; even with earnings growth that isn’t keeping up with U.S. companies’, foreign stocks appear better than fairly priced.

The Bailard Technology Strategy posted a 4q24 total return of 3.06% net of fees, trailing both the cap-heavy benchmark index (S&P North American Technology Index) and the competitor-comprised benchmarks. The Morningstar U.S. Open End Technology Category returned 5.94% and the Lipper Science and Technology Fund Index returned 5.86%, while the S&P North American Technology Index generated 5.92% return and the Nasdaq-100 Index returned 4.93%.

A surprisingly hawkish tone from the Federal Reserve board in December suggesting that they plan to keep interest rates “higher for longer” drove market participants back into the arms of large cap growth stocks. Fear of a slower economy with persistent inflation and higher interest rates in the short term countered earlier enthusiasm for smaller cap stocks driven by the potential for a lower regulatory burden under the Trump administration starting in 2025.

Bailard advances its efforts to seize opportunities in the evolving real estate market. With a disciplined investment approach and an expanded team, the Bailard Real Estate Fund is positioned for growth in the year ahead...

South Korea’s President declared martial law—but quickly reversed it. This led to two impeachments during the month and the Finance Minister acting as President and Prime Minister at year’s end.

LLMs. Co-pilots. Agents. Two years after ChatGPT took the world by storm, the hype behind artificial Intelligence remains palpable. Major tech companies are pouring billions into sparkling new infrastructure for AI workloads. Utility companies in areas with dense data centers are seeing revenues and power consumption soar. Yet, outside of semiconductor and infrastructure players, few companies have seen significant revenue from AI products. Investors are increasingly left asking: When will these massive capital investments start benefiting software companies? What’s causing the delay?

Sonya Mughal, CFA opens up in a candid interview with Pensions & Investments' about her journey from an entry-level position to CEO, all at Bailard, in her 30-year career solely dedicated to the Company. She discusses her and Bailard's values, how people can find the right place to work, Bailard's culture, and the importance of understanding your clients.

Bailard, an independent asset and wealth management firm based in the San Francisco Bay Area, has been named one of the 2024 Best Places to Work in Money Management by Pensions & Investments.

Donald Trump won the electoral college and popular vote on November 5th to regain the U.S. presidency in January. Republicans also gained a Senate majority and held control of the House. Trump has rapidly announced loyal supporters as Cabinet picks. Markets echoed November 2016: a strong dollar, U.S. equity outperformance, and small cap/value stocks outperforming large cap/growth.

Japan’s ruling LDP-Komeito coalition lost its parliamentary majority in a snap general election. Chosen as party leader just weeks ago, PM Ishiba must cobble together support from other parties to avoid losing his job in record time.

Dave Harrison Smith, CFA, Head of Technology Investing at Bailard, Alex Gunz, Fund Manager at Heptagon Capital, and Alastair Paterson, Co-Founder & CEO of Harmonic Security join Jill Malandrino on Nasdaq TradeTalks to discuss why the potential in cybersecurity lies in AI’s ability to recognize patterns and optimize threat detection.

Political events continued to make headlines in the third quarter: the UK and France both held elections, while Japan’s ruling party chose a new leader. Chinese policymakers announced new stimulus measures, which prompted a rally in mainland and Hong Kong markets. Despite these twists and turns, the economic backdrop overall remains favorable as most central banks are reducing rates and anticipated growth rates remain positive, though lukewarm. Company fundamentals remain strong across a variety of countries and industries, with foreign markets maintaining valuation advantages against their U.S. counterparts.

While the US stock market delivered strong performance overall, the third quarter witnessed significant shifts in relative equity style performance. Value, which had trailed growth through the first half of the year, outperformed in Q3. Similarly, small cap stocks outperformed large cap in Q3 after lagging earlier. While cumulative past performance and valuation disparities had set the stage for a realignment, the trigger came in the form of anticipated rate cuts by the Federal Reserve.

The Bailard Technology Strategy achieved a total return of -1.65%, net of fees. This performance trailed the S&P North American Technology Index and other competitor benchmarks. The Morningstar U.S. Open End Technology category returned 2.42%, the Lipper Science and Technology Fund Index returned 1.37%, the S&P North American Technology Index generated 1.86%, and the Nasdaq 100 Index returned 2.12%. However, over 3, 5, and 10 years, the Strategy's net returns outperformed the competitor peer benchmarks.

Global markets cheered the Fed’s widely anticipated rate cut, accelerating the outperformance of gold and emerging markets as the US dollar weakened.

Bailard, Inc., an independent wealth and asset management firm, is proud to announce its recognition as one of the Bay Area’s 2024 Top Workplaces by the San Francisco Chronicle. The firm was ranked second in its category (for companies with 35-149 employees).