Knowledge Has Outperformed By Over 6% And Is Cheaper Than The Market by Eric Bush, CFA – Gavekal Capital Blog
Developed World Knowledge Leaders have been on a nice roll over the past year. The Gavekal Knowledge Leaders Developed Word Index (KNLGX) has returned 11.12% over the past year. In this same period, the MSCI World Index has only returned 4.86%. While the overall market has been primarily led by four sectors (materials, health care, consumer staples, and information technology), KNLGX has seen broader participation with seven out of 11 sectors returning at least 10% over the past year. What is even more interesting is that for the most part, on an intangible-adjusted basis, Knowledge Leaders remain cheaper than the overall developed world stock market. On a P/E basis, Knowledge Leaders are cheaper on average in all sectors except for financials. Same for P/CF. On a P/B basis, Knowledge Leaders are cheaper on average in all sectors except for financials and real estate (together they make up less than 3% of the overall KNLGX index).
Note: All data in the tables below are on an equal-weighted, USD basis.
