- Home
- Resources
- Five in Five
Five in Five
Welcome to Five in Five, a monthly publication that shares graphs on five key topics, illustrating the current state of the markets. Each edition includes brief commentary that can be easily read in five minutes or less. We hope you find this concise analysis helpful and informative.
July 2025
This month’s Five in Five covers the following topics:
- Treasury Yields
- Corporate Bonds
- Large Cap Growth Stocks Finish Q2 Strong
- Market Volatility Relatively Low Despite Volatile Oil Prices
- Large Cap Growth Stocks Exhibiting Strong Earnings Growth Forecast
Treasury Yields
- Price action on the 10-year Treasury may be giving early clues to lower yields.
- Red arrows signified when pullbacks after a rally were too deep to suggest a new trend.
- Green arrows show “quiet” pullbacks after a rally that imply a breakout could be sustainable.
- The offset is that this logic failed in 2023, along with no medium-term trend to lower yields.
Sources: BTC Capital Management, Bloomberg
Corporate Bonds
- Corporate bonds are the best performing fixed income sector over the last year.
- Corporate bonds have outpaced Treasurys by 1.24% annually over the last 30 years.
- We maintain a generally favorable view toward corporate bonds.
Sources: BTC Capital Management, Bloomberg
Large Cap Growth Stocks Finish Q2 Strong
- After underperforming on a relative basis during the first part of the year, large cap Growth stocks rebounded
during the second quarter, far outpacing other style/size categories, and have now closed the gap versus Value on
a year-to-date basis. - In particular, the Magnificent 7 group of stocks outpaced the broad index by almost 7% during the second quarter.
- Upwards earnings revisions for U.S. stocks have been rising recently, outpacing downwards earnings revisions, as
analysts have become more bullish regarding the market’s outlook.
Source: PSC Portfolio Strategy
Market Volatility Relatively Low Despite Volatile Oil Prices
- Oil prices (left axis) have seen much volatility in the last few months, from $60 in early May, rising to $76 in midJune, and back down to $65 this week.
- Market volatility, as measured by VIX (right axis), was not in sync with the increased volatility in West Texas
Intermediate (WTI). In fact, it fell for most of May and fluctuated to some degree in June. - Historically, there has been a strong correlation between rising volatility in the stock market and oil prices. However,
that relationship has broken down as investors seem to have shrugged off the recent price movements in WTI.
Sources: BTC Capital Management, FactSet
Large Cap Growth Stocks Exhibiting Strong Earnings Growth Forecast
- For the next twelve months, earnings-per-share (NTM EPS) are expected to grow year-over-year for the MSCI USA series of indexes,
which includes MSCI USA (large cap core – blue line), MSCI USA Growth (large cap growth – green line), MSCI USA Value (large cap
value – purple line), and MSCI USA Small Cap (small cap core – yellow line). - Anchoring each tail of this spectrum are large cap growth, which exhibits the highest estimated NTM EPS growth (+17.8%), while large
cap value exhibits the lowest estimated NTM EPS growth (+0.6%). - Falling within the two extremes are large cap core (+7.9%) followed by small cap core (+3.4%).
- Small cap core exhibits an attractive, relative valuation when considering its price-to-earnings growth ratio (PEG) of 1.5x. Surprisingly,
the PEG for large cap growth (2.2x) approximates that of large cap value (2.1x). - The perceived sustainability of EPS growth within large cap, specifically large cap growth and large cap core, may support the
projected premium valuation over small cap.
Sources: BTC Capital Management, FactSet
Important Disclosures
Sources: BTC Capital Management, Bloomberg, FactSet, PSC Portfolio Strategy
The information provided has been obtained from sources deemed reliable, but BTC Capital Management and its
affiliates cannot guarantee accuracy. Past performance is not a guarantee of future returns. Performance over periods
exceeding 12 months has been annualized.
This document is intended for informational purposes only and is not an offer or solicitation with respect to the
purchase or sale of any security. Statements in this report are based on the views of BTC Capital Management and on
information available at the time this report was prepared. Rates are subject to change based on market and/or other
conditions without notice. This commentary contains no investment recommendations, and you should not interpret
any statement in this report as investment, tax, legal, and/or financial planning advice. All investments involve risk,
including the possible loss of principal. Investments are not FDIC insured and may lose value.