In the 3rd quarter, U.S. equity beta rewarded investors. "Buy risk," "buy on the dips," "buy growth", was the path to outperformance. Thanks to a strong earnings season, reasonably tame inflation, and a business-friendly administration, the S&P 500 Index was the clear winner among the various asset class returns in the third quarter (see Figure 1). Chinese equity markets continued to weaken amidst trade war rhetoric and successive rounds of tariffs. Tesla, Inc.'s CEO, Elon Musk's tweets and taunting of short sellers finally caught up with him. The U.S. Securities and Exchange Commission (SEC) fined both Tesla and Musk and required his removal as chairman because of his off-the-cuff comments proposing taking Tesla private.
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