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Challenging your portfolio construction beliefs
Fodder this
week challenges some common portfolio construction
beliefs (the aim on which we founded the Forum). Tim Farrelly
challenges one of
the barrage of reasons not to
buy Australia's major banks. Michael Edesess challenges
the (almost) universally accepted principle of
periodically rebalancing portfolios. Tribeca
Investment Partners takes aim at the sense of
long-term investing. PIMCO's outgoing CEO, Doug
Hodge, puts forward a challenge to all asset
managers but, actually, Doug's challenge applies to
us all. And, we re-profile our recent Backgrounder
on the challenges of managing the friction between
short-term and long-term investing imperatives.
All the best for a great weekend's continuing
education - Graham
P.S.
Mark your
diary now for Symposium 2017 (16-17 May)
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LATEST... |
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Investing
The banks at risk of an Aldi moment - sell!
The latest reason offered as to why not to buy
Australia's major banks is that their margins could
be taken away by a well resourced disrupter. Should
we not own the banks, as a result?
Tim Farrelly, farrelly's |
Opinion
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Strategies
The failure to understand rebalancing
We've been drilled that rebalancing portfolios
results in improved returns and/or reduced risk. But
the benefits of rebalancing are far smaller than
we’ve been led to believe.
Michael Edesess, EDHEC-Risk Institute |
Opinion
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Markets/Investing
Long-term investing is a fool's paradise
A range of cognitive biases leads investors to
generally overestimate their skill. A long-term
investment strategy simply compounds this problem. A
long-short investment structure can improve
outcomes.
Tribeca Investment Partners |
White Paper
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Philosophy
Asset managers must adapt to serve their clients
Client needs are changing. And these changes will
challenge asset managers, especially as the industry
goes through consolidation.
Doug Hodge, PIMCO |
Opinion
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Philosophy/Markets/Strategy/Investing/Finology
Backgrounder: The long and short of it
Managing the fundamental friction between short-term
and long-term investing imperatives is a key
challenge when building portfolios.
PortfolioConstruction Forum
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White Paper
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Delta model
Michael's model is fantastic. We use it for
researching managers and explaining decisions to
clients...
Justin Hooper, Sentinel Wealth
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Comment
Measuring recessions
...Couldn't
agree more. Every time I drive in Sydney traffic I
wish we were targeting GDP per capita as our measure
of prosperity.
Tim Farrelly, farrelly's |
Comment
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RECENTLY... |
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Markets
Monetary reform - looking in the wrong places
Zero and especially negative nominal interest
rates are a fool's game. We are entering the late
phase of an ageing expansion when asset price bubbles
and poor credit decisions sow the seeds of the next
crisis.
Dr Robert Gay, Fenwick Advisers
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Opinion
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Markets
The economic trend is our friend
Economic growth since 2008 has been profoundly
disappointing and pessimism understandably comes
easy these days – perhaps too easy. If we look at
global economic growth over the next 30 to 60 years,
the picture looks much brighter.
J. Bradford DeLong, University of California |
White Paper
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Strategy
Flexibility is key to goals-based strategies
Individuals underestimate the degree to which their
lives will change over the long-term, so how can
practitioners build portfolios which are likely to
meet their clients' future needs?
Michael Kitces, Pinnacle Advisory Group |
Opinion
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Investing
Look for the signal within the noise
Using a simple case study, this paper illustrates an
approach to cutting through fund performance "noise"
to find the signal - the bigger picture investment
view that enables us to construct better investment
portfolios.
Michael Furey, Delta Research & Advisory |
1 comment
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Research
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Markets/Investing
Spurn the supernova and fight the fear of fixed
income
Bond market Cassandras proclaim the formation of a
supernova, warning of the investment perils. It's
time to spurn this talk, and stick with the core,
defensive anchor provided by global fixed income.
Jeff Grow, UBS Asset Management |
White Paper
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Bakers dozen
Perhaps I'm missing something... Firstly, isn't
the constant price series rebased each year as a
reasonable response to the distortions you refer to?
Stephen Romic, DFS Advisory Services
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Comment
Bakers dozens
This is not really a matter of distortions, just
different measurements capturing different effects.
As for the new bakers production...all I can say is
good try!
Tim Farrelly, farrelly's |
Comment
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