We explain the approach to valuing the S&P 500 developed by NYU Professor Aswath Damodaran a co-author with our senior advisor Professor Bradford Cornell, and explain its relevance to current market conditions.

Download Memo as PDF  Efficient markets              If markets are efficient in that prices always reflect fair value and expected returns on stock are constant, why would anyone need an investment manager? There are two answers. The first, put forth by Sandy Grossman and Joe Stiglitz, is that a truly efficient market is a contradiction

There is an inverse relationship between current investment performance and expected future performance. Understanding why is a key to maximizing long-run risk adjusted returns.

Senior Advisor, Prof. Bradford Cornell, was quoted in the Wall Street Journal regarding his work with Prof. Aswath Damodaran on ESG investing. “The implicit promise of ESG investing is that you can do well and do good at the same time. Investors presume they can make a market return while advancing causes such as lowering carbon

We are happy to report that the entire “Reflections on Investing” series is now available as podcast on Apple Podcasts and Spotify. Click on your preferred platform below to listen. Be sure to add the show to your library to stay updated with future episodes. In other podcast related news, CCG senior advisor Prof. Bradford Cornell

Building off our previous episode, we dig into the relationship between current price ratios, future expected earnings growth, and future stock market returns. It turns out there are important practical implications for investment management.   

Finance theory in recent years has stressed the importance of changes in the discount rate for explaining movements in stock prices. In this video, we describe how this works using data provided by Prof. Aswath Damodaran.  You can find both Damodaran’s annual paper on the equity risk premium and his calculation of the ERP for

As former US Secretary of Treasury Larry Summers has stressed, the real interest is an important indicator of the impact of Federal Reserve policy. In this short video we take a look at real interest rates through history.

Relative price changes, changes in the price of one good or service relative to others, are often confused with inflation but are fundamentally different. This difference can lead to a misunderstanding of the causes of inflation. In this video, we explain the difference and what it implies for policies to control inflation. 

The Shiller CAPE Ratio is often referenced yet at times not fully understood. In this latest installment, Prof. Bradford Cornell starts at the source and breaks down this popular metric in detail.