The Knowledge Effect: Excess Returns Of Highly Innovative Companies

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The Knowledge Effect: Excess Returns Of Highly Innovative Companies

The Knowledge Effect: Excess Returns Of Highly Innovative Companies via Gavekal Capital

By Steven Vannelli, CFA, and Eric Bush, CFA

Executive Summary

In this paper, we identify the Knowledge Effect, the tendency of stocks of highly innovative companies to experience excess returns. It results from investors’ systematic errors in evaluating companies that invest large sums of money in producing knowledge.

Massif Capital’s Top Short Bets In The Real Asset Space [Exclisuve]

Screenshot 2022 08 10 18.57.51 1Since its founding by Will Thomson and Chip Russell in June 2016, the Massif Capital Real Asset Strategy has outperformed all of its real asset benchmarks. Since its inception, the long/short equity fund has returned 9% per annum net, compared to 6% for the Bloomberg Commodity Index, 3% for the 3 MSCI USA Infrastructure index Read More

The origins of the Knowledge Effect can be traced to two factors