The Knowledge Factor’s 8-Year Run Of Outperformance Continues Through May by Eric Bush, CFA – Gavekal Capital Blog
The Knowledge Effect, which is the tendency of highly innovative companies to experience excess stock market returns, is alive and well in 2016. The Gavekal Knowledge Leaders Developed World Index (KNLGX) has continued to outperformed this year as it has in 13 out of the previous 15 years from 2000-2015 (see first chart below). KNLGX has also outperformed in three out of five months in 2016 for a cumulative outperformance of 1.75% over the MSCI World Index YTD. On an absolute basis, KNLGX is 3.5% higher so far in 2016.
