Emphasize the Essentials

Posted on 06/12/2019

This article is sponsored by MFS Investment Management.

Rob Almeida, an investment officer and global investment strategist for MFS Investment Management® (MFS®), discusses why it’s important to put macroeconomic data in context and focus more on material corporate fundamentals.

In brief

  • Investors often pay outsized attention to binary outcomes while focusing too little on the importance of material factors such as free cash flow generation and intellectual property.
  • The ongoing technological revolution has made historical economic comparisons less relevant.
  • Financial markets place a great deal of emphasis on binary outcomes: Will the Fed lower rates? Will there be a resolution to the US–China trade war? Many a short-term investment thesis has relied on predicting the answers to these sorts of questions.

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