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Sponsoring the Study of Art: Learning From The Renaissance Age

One of the enterprising, most important and breathtaking professions and area of study is Art. The great impacts exerted by art in our lives as humans are very severe such that scholars in the field synonymously interchange life with art and vice versa. This is true because from personal adornment through to the enhancement of our societies and the carrying out of our everyday activities pivots on art. It is, however, sad to realize how people rate and value art today. Art receives low patronage and recognition in the pool of other disciplines. Students who would want to pursue the study of art due to their awe-inspiring talents in sculpture, graphics, leatherwork, basketry, ceramics and the other vibrant fields of art do not receive the due sponsorship. These young enterprising artists end up shattering their great talents and resort to engaging in petty chores like cleaning, helping in construction works, housekeeping, and trading. The situation is escalated even in developing countries in Africa. The patronage of art is so low such that students from affluent homes who would want to pursue art are discouraged by their parents and even mocked at by their mates as timid students. The few who courageously take up the cross of art lack funding from funding agencies who prioritize the sponsorship of the so-called sciences and maths! Yet, the multi-million question we must ask ourselves is that ‘Are the other disciplines better than art?Some argue that health sciences, economics, mathematics, and geography are enterprising because their industries have been established already and those professions are well paid and as such highly respected. Moreover, they are pursued by academically giants and gurus who had higher grading points. Though somehow true, these professions are no better than the arts. A retrospection into the renaissance age stresses this assertion.Staunch scholars who were well versed theoretically and practically in various fields of human endeavor like Science, Mathematics and Engineering pursued art in the renaissance age. For instance, Leonardo da Vinci who was a leading figure in art, particularly painting and sculpture, was a scientist and engineer at the same time. He reckoned that art played quintessential roles in the society that either surpassed or equaled the sciences and maths. Michelangelo, Brunelleschi, Donatello and the other great artists in that era were brilliant scholars! Even today, great scholars and students who attain high grading points study art. This clears the wrong notion that art is pursued by the academically weak and as such receives low patronage and sponsorship.In addition, art received great sponsorship in the renaissance period. The Medici family from Florence in Italy sponsored art programs, seminars, workshops and competitions that were to hunt for talents in art. Projects in art received high sponsorships from governmental authorities, famous personage and wealthy businessmen in the society. This great support raised the patronage of art and its recognition was commonplace. The situation is different today. Art programs and workshops aimed to raise the standards of art receive low or no sponsorship from funding agencies, institutions and wealthy well-meaning persons in the society. This situation must cease if we want to realize the advancement in our societal, national and global development.Art must be associated with respect and status in our societies due to the great impact it wields on societal events and activities like its counterparts in other disciplines. In fact, the so-called successful fields of study like architecture, engineering, mathematics, and the health sciences depend on art in the discharge of their duties.The time is now for scholars, governments, funding agencies and well-meaning personage in the societies to support and fund art programs, education and other activities that would assist in its development. The accolade of art is still true today that ‘art is life’. Sponsorship of art is greatly needed and it must be attended to with all seriousness to facilitate and speed up the grooming of young talents, arrest the unemployment crisis of the numerous young persons and unemployed in societies to make our world a better place. Indeed life is art, and art is life!

What Will Tennessee Health Insurance Do With Health Care Reform?

A study by Blue Cross Blue Shield of Tennessee takes an in-depth assessment of the possible effects that national health care reform could mean for Tennessee residents. The study estimates that 683,000 Tennesseans will get new Tennessee health insurance coverage under health care reform. It also focuses on possible changes in access to medical care, as well as the shift from employer-provided TN health insurance to the state exchange.Dr. Steven Coulter, president of the Tennessee Health Institute, conducted the study entitled “National Health Care Reform: The Impact On Tennessee.” According to Coulter, the study explores how the expansion of Medicaid and the establishment of the TN health insurance exchange in 2014 will affect the residents of Tennessee.Coulter says that since the advent of Medicare in 1965, the Patient Protect and Affordable Care Act has been the largest expansion of entitlement programs. “With the expected increase in consumers eligible for Medicaid expansion coverage and an estimated 1.5 million qualifying for subsidies in 2014, there is a great deal that needs to be addressed to ensure a smooth transaction,” he says. Coutler also noted that people who already have access to health care might have to wait longer when more people can afford to see a doctor unless there are basic changes to the health care system.What’s Happening With The Shortage Of Doctors In Tennessee?Long before health care reform, an appalling shortage of doctors was noted in Tennessee, and the situation has improved dramatically in some counties. On October 26, 2011, The Jackson Sun reported that the situation had improved in rural West Tennessee. Specifically, the doctor-patient ratio in Hardeman County went from one doctor per 4,675 people to one doctor per 2,229 people from 1992 to 1999. Chester County saw similar improvement with the ratio of one doctor per to 6,409 people falling to one doctor per 2,505 people.What’s Happening to Tennessee Health Insurance Prices?Coulter also notes the possibility that young adults will have to pay more for Tennessee health insurance by 2014. That’s because health care reform tends to level the playing field, so to speak. Groups, like the long living, have been paying high premiums, while young people have been paying low premiums. To average out the price of TN health coverage for all residents, some will likely end up paying more, but those who have been paying high rates, will get a break.Who Stands To Gain The Most From Health Care Reform?Overall, the people with the greatest economical disadvantages stand to benefit most as access to health care is extended to more state citizens. People who have been barred from getting TN health care coverage based on medical conditions will also get greater access to health care when they can finally get coverage.Employers are also expected to have financial gains when they can encourage employees to get Tennessee health insurance through the exchange because not providing coverage will improve the company’s bottom line.Will Everyone Directly Benefit From Health Care Reform?It remains to be seen whether people who currently have TN health insurance will have longer wait times for health care, with more doctors and clinics coming to the state. For example, a federally-funded clinic opened in Hardeman county in 1993 and in Hardin county in 1995. In East Jackson, West Tennessee Healthcare opened a clinic in 1996, and federally-funded clinics have been operating in Fayette and Lake County since the 1970s.Tennessee health insurance companies will have to navigate new price regulations and could see their profit margins decreasing over time. Insurers selling individual TN health insurance plans are already required to spend 80 percent of the premiums they take in to pay for policyholders’ care. That reduces the amount of premiums they have been permitted to keep as profit. Group plans have been managing regulations that require they spend 85 percent of premiums for policyholders’ care, though.

Optimizing Portfolio Performance with Equity Styles

1) Equities can be grouped into six “equity styles”2) Returns of each equity style can vary significantly with trends persisting for months and years.3) By dynamically altering a portfolio’s exposure to various equity styles, investors can attempt to add performance over a static allocation.4) Relatively simple strategies can be employed to signal rotational decisions among various equity styles.September, 2005I view equity style strategies as one of the most powerful and profitable elements of our Absolute Return Portfolios.THE TWO AXES OF EQUITY STYLESIn Equity Style vernacular, stocks can be grouped along two axes: 1) Market Capitalization and 2) Fundamental Valuation.MARKET CAPITALIZATIONMarket capitalization is simply the outstanding number of shares multiplied by share price. That product represents the total value, or market capitalization, of a publicly traded company. If a firm had 1 million shares outstanding and traded at $50 per share, the market capitalization would be $50 million, for example.FUNDAMENTAL VALUATIONThe second axis on which a company can be compared is fundamental valuation. Stocks are characterized as either “growth” or “value” firms. This categorization is dynamic in that growth companies can become value companies and vice versa. The approaches used to characterize companies into one of these two categories are quite varied and can run from the utterly simplistic to esoteric multi-factor models.All categorization techniques seek to use one or more fundamental variables to categorize a company as either a “growth stock” or “value stock”. Initial approaches were based on ranking companies of the basis of price-to-book value (P/B ratio). Those companies with the highest P/B ratio were categorized as “growth” while those with the lowest P/B ratio were considered “value stocks”. Since that time, models that use an assortment of fundamental ratios (Price/Earnings, Price/Sales, Gross Margin Percentages, EPS and Sales Growth etc.) have been developed to better categorize stocks into their respective camps.THE EQUITY STYLE MATRIXReally, the categorizations are nothing more than combining one group from each of the two axes that cover capitalization and fundamental valuation. Since we have three capitalization groups (small, mid, and large) and two fundamental valuation groups (growth and value) our matrix is comprised of the six equity styles below:Small-Cap GrowthMid-Cap GrowthLarge-Cap GrowthSmall-Cap ValueMid-Cap ValueLarge-Cap ValueRELATIVE PERFORMANCE – MARKET CAPITALIZATIONThis exercise wouldn’t be very interesting if it weren’t for the fact that significant variability occurs among the returns of these six equity styles. Let’s start with just the Market Capitalization axis and review the performance of Small-Cap versus Large-Cap stocks over two recent periods. I will be using the S&P 500 as a proxy for large-cap stocks and the Russell 2000 as a proxy for small-cap stocks.Period of Large-Cap dominance (March 30, 1994 – March 30, 1999)Index Total Return & Annualized ReturnS&P 500 (Large-Cap):220.66% & 26.20%Russell 2000 (Small-Cap): 57.71% & 9.50%Period of Small-Cap dominance (March 30, 1999 – June 30, 2005)Index Total Return & Annualized ReturnS&P 500 (Large-Cap): 1.70% & 0.27%Russell 2000 (Small-Cap): 60.87% & 7.92%This first period coincided with a powerful bull market. Large-cap stocks delivered incredible returns of over 26% annually! Even though the large-cap stocks trounced their small-cap brethren, the small-caps still had a respectable showing returning 9.50% annualized. Things get more interesting in the second period which encompassed a massive bear market decline. Over this past 6.25 year period large-cap stocks haven’t even provided money market rates of return. Small-cap stocks have provided a respectable result considering that many indexes suffered declines of over 50% within this time period.RELATIVE PERFORMANCE – FUNDAMENTAL VALUATIONLet’s now turn our attention to the other axis of Fundamental Valuation and review performance trends among growth and value equity styles. In this case, I will use the Morningstar indices as proxies for the growth and value equity styles.Period of Growth Style dominance (December 31, 1997 – March 31, 2000)Index Total Return & Annualized ReturnGrowth: 127.98% & 44.23%Value: 10.28% & 4.45%Period of Value Style dominance (March 31, 2000- June 30, 2005)Index Total Return & Annualized ReturnGrowth: -55.01% & -13.75%Value: 54.16% & 8.34%The difference in performance over both of these periods is staggering. During the first period ending March 2000, Growth stocks out-performed valued stocks by nearly 40% per annum. Their period of relative strength ended coincident with the top in Technology stocks and since then value stocks have taken the lead. Since March 2000, growth equities have depreciated by over half whilst Value equities have appreciated over 50%! That’s better than a 20% annual difference between growth and value.COMBINING THE BEST EQUITY STYLES – Market Capitalization and Fundamental ValuationAs I’ve shown, recently small-cap stocks have been performing significantly better than large-cap stocks. Similarly, Value stocks have been doing relatively better than growth stocks. Initially, we looked at each of these factors in isolation but the real performance boost comes from combining the best of both worlds. In recent history, this has meant Small-Cap Value has been among the very best places to invest.Using the Morningstar style boxes below, I have ranked them by performance since the Value outperformance cycle began in the spring of 2000.Index Return 03/30/1999-08/31/2005:Morningstar Small-Cap Value: 156.50%Morningstar Mid-Cap Value: 113.70%Morningstar Smal-lCap All Style: 110.63%Morningstar Mid-Cap All Style: 75.21%Morningstar US All-Cap Value: 51.36%Morningstar Small-Cap Growth: 31.89%Morningstar Large-Cap Value: 31.33%Morningstar Mid-Cap Growth: 23.94%S&P 500 Index: 3.34%Morningstar Large-Cap All Style: -7.54%NASDAQ Composite Index: -13.23%Morningstar US All-Cap Growth -33.49%Morningstar Large-Cap Growth -47.44%The performance differences among the various equity styles are extraordinary. From the very best performance from Small-Cap Value to the very worst performance from Large-Cap Growth there is over a 200% difference over the 6+ year period evaluated! Annualized, that amounts to over 19% from Small-Cap Value as compared to over a -16% loss from Large-Cap Growth. That’s greater than a 35% difference in annual returns.DRIVERS OF EQUITY STYLE PERFOMANCEThere are many drivers of relative performance among various equity styles. The factors effecting each of the Market Capitalization and Fundamental Valuation cycles have overlapping as well as unique drivers and catalysts both economic and political. The topic is complex and beyond the scope of this article. As a generalization, relative valuation drives the performance along the Market Capitalization axis (large-cap vs. small-cap). Macroeconomic factors drive performance along the Fundamental Valuation axis (growth vs. value).TRACKING EQUITY STYLE RELATIVE PERFORMANCE TRENDSA picture is worth a thousand words. I recommend using charting software or a service such as BigCharts.com or Stockcharts.com (with whom I have no affiliation) that will allow you to compare the performance of the various equity styles graphically. The type of analysis is referred as Relative Strength or Relative Performance. A Relative Performance line is calculated by simply divided the price one index by another for each period and then plotting those resulting ratios.An upward trend in the Relative Performance line indicates that the index in the numerator of our comparison is performing better than the index in the denominator. Likewise, a downtrend in the Relative Performance line indicates that the index in the numerator is performing more poorly than the index in the denominator.By tracking these Relative Performance trends, investors can determine which “equity style box” they should concentrate upon. This is true whether you buy individual stocks, mutual funds, variable annuities, or ETFs. Smaller investors have a tremendous advantage over billion dollar mutual funds and registered investment advisors that can pursue only one equity style.EQUITY STYLE INVESTMENT VEHICLESThere are now a large number of ways to take advantage of equity style trends. For ETF-based strategies the Yahoo Finance site is an excellent resource for searching for ETFs. For mutual fund investors, Rydex and ProFunds both offer all of the various equity styles. The large mutual fund houses also offer many of the equity style funds but aren’t as friendly to mutual fund switchers as Rydex and ProFunds.STAYING ON TOP OF EQUITY STYLE TRENDSOur FREE managed account publication, The Absolute Return Strategist, covers equity style trends each week. Those that are not as technically proficient can get our regular updates on equity style trends and how we are positioning our Absolute Return Portfolios. Additionally, our site provides the unabridged version of this article complete with charts and tables.DISCLAIMERThese reports express our opinions and suggestions, provided only as a supplement to your own further research and decisions. We take care to assure accuracy of contents but accuracy is not guaranteed. Past performance does not imply future results. The publisher shall have no liability of whatever nature in respect of any claim, damages, loss or expense arising out of or in connection with the reliance by you on the contents of our web site, any promotion, published material, alert or update.©2005 Absolute Return Portfolio ManagementALL RIGHTS RESERVED