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G'day
I trust you had an enjoyable
Easter/ANZAC
holiday period (and caught up on
some back issues of Fodder as suggested!). In this week's Fodder,
Nouriel Roubini explains
why the biggest geopolitical risk of our times
is not tensions in the Middle East or the risk of Cold War II but,
rather, the challenge of sustaining the peaceful character of China's
rise. Tim Farrelly's
white paper examines the long-term return
drivers four common alternative assets (be wary of
asset classes that have been subject to a substantial increase in
inflows). PortfolioConstruction Forum Member and self confessed quant
geek, Michael Furey, analyses
absolute return funds on offer in
Australia, finding just 16 have met the definition to date. Angela
Ashton reviews Towers Watson's
compendium on global equity investing,
concluding it's well worth checking
your own portfolio
construction philosophy against it. We all know
equity valuations are an important driver of investment return. Invesco Perpetual's Stephen
Anness |
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shows that
valuation is also an
key driver of volatility.
And finally, we profile the very, very
popular session from Markets Summit 2014 in which all our presenters
debate two critical issues for portfolios for the coming three years.
All the best for a great weekend's learning -
Graham
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LATEST...
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Global ground zero in Asia
Long-standing historical grievances among China, Japan, Korea,
India, and others remain open wounds. Why are tensions among Asia's
great powers becoming more serious?
Nouriel Roubini, Roubini Global Economics | Opinion
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It's time to start looking at alternative assets
It is time to start looking at alternative assets. Not because there is
any pressing need to invest today, but because thorough analysis takes
time and mistakes can be expensive.
Tim Farrelly, farrelly's | White
Paper
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Fureyous: Absolute return investing... a nice goal
It is fine to have positive returns year-in, year-out as an objective or
goal. But, absolute returns should never be presented as an expectation,
as disappointment is inevitable.
Michael Furey, Delta Research & Advisory | Opinion
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Global equity investing: Insights into a better portfolio
Towers Watson's compendium of insights into global equity investing
contains useful insights about issues many portfolio construction
practitioners face every day.
Angela Ashton, PortfolioConstruction Forum | Research
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Why valuation really matters
Valuation is not just an important driver of investment returns but also
of investment volatility.
Stephen Anness, Invesco Perpetual
| Opinion
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Markets Summit 2014 Investment Advisory Board Meeting
Our Markets Summit faculty debated two critical issues arising from Unconventional Monetary Policy; for
the coming two to three years, to substantially overweight DM vs EM
Equities in portfolios and substantially overweight Short vs Long Duration
Bonds.
Markets Summit 2014
Investment Advisory Board | Resources
* Rated "very good" by
delegates, this was the "must see" session of the program!
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Other good reads
Pseudo-mathematics and financial charlatanism
- highlights the perils of backtesting. Fund managers commonly use
backtesting in the marketing of new strategies. This study shows that
many unwittingly engage in "overfitting", leading them to overstate the
promise of their offerings.
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RECENTLY...
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Active versus passive
The active versus passive debate was recently given a boost when Warren
Buffet suggested in his annual letter that most investors are better off
investing passively.
Dominic McCormick, Select Asset Management | 1
comment | | Opinion
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The Fed's exit strategy
The Fed’s published policy on how it will exit QE is fairly old.
Overall, though, there is not a huge overhang of securities that the Fed
needs to sell to exit.
Dr Robert Gay, Fenwick Advisers | Opinion
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Investing for retirement: the defined contribution challenge
Target date funds are becoming the workhorse for DC plans but there are
problems with the approach. This paper offers a portfolio construction
framework to overcome them.
Ben Inker & Martin Tarlie, GMO | White
Paper
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Divorcing your debt benchmark
Divorcing your debt benchmark and adopting more unconstrained approach
to debt investing and offering degrees of freedom to the portfolio
manager is the new "core".
Lisa Kim, PIMCO
| Opinion
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Emerging markets on trial
Against a backdrop of currency slides, yield spikes and chronic equity
underperformance, we invited our EM experts to defend their asset class
against three charges.
BlackRock
Investment Institute | White
Paper
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Quantitative squeezing - differentiation in EM Investing
Our Markets Summit faculty debated two critical portfolio construction
issues arising from Unconventional Monetary Policy.
Kathryn Koch, Goldman Sachs Asset Management | Resources
* Rated "very good" by Markets
Summit 2014 program delegates
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PLUS...
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Markets Summit
2014 - The Great Escape - Resources Kit online
The most successful
Markets
Summit program yet (97% of delegates rating it good (42%) or excellent
(55%)), the 2014 program featured a stellar line-up of international and
local geopolitical specialists, economists, market/asset class experts,
and investment strategists. Each offered a high conviction idea
regarding the impact of Unconventional Monetary Policy on the
medium-term outlook for the global economy, key market or asset class -
and, of course, the implications for portfolios.
Access a baker's dozen of expert, high conviction insights to consider
applying when building portfolios.
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Mark Your
Diary: PortfolioConstruction
Forum Conference (19-21 Aug)
Since 2002, PortfolioConstruction Forum Conference has gained a
reputation as THE investment conference of the year. Presented in Sydney
each August, it is our flagship program - a jam-packed, marathon
three-day, 25-hour program featuring 40 intensive, objective,
interactive sessions and more than 50 carefully selected local and
international portfolio construction experts. It is a companion program
to the annual Markets Summit held in Sydney each February.
Preview the theme "Reconnecting the three Rs - Risk & Return (&
Relating)"
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Keep up to
date - follow us @PortfolioForum
There's no need to wait until
our weekly Forum Fodder email to know what's new with PortfolioConstruction Forum.
Just follow us on Twitter to hear as soon
as we release new articles on
PortfolioConstruction.com.au and
registration opens for our live programs.
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