Forum Fodder

PortfolioConstruction Forum







Our regular Forum Fodder email alerts Members to what's new on this site and with our live professional development progams. A sample of the Forum Fodder email is below.  Become a Member (with our compliments) to receive Forum Fodder and access our multi-media learning centre, (this site) featuring:
- Resources Kits - videos and podcasts of the sessions and accompanying papers from our live programs;
- Perspectives library - exclusive interviews, research papers, white papers, opinion papers and special interest; and,
   subscription services from local and international investment professionals and subject matter experts.

Friday 07 October 2016

Specialist, independent investment continuing education & certification for portfolio construction practitioners

US recession risk, bond tents, benchmarking & global small caps
Hamish Douglass leads Fodder this week with a 6-minute video Insight on why it's our duty to encourage investors to focus on the long-term. Chris Watling looks at whether the US is heading for recession (probably, the risks are rising) and along the way explains which indicators are the most reliable (not many). Chris will be with us in person in February for Markets Summit 2017. Michael Kitces explains how a "bond tent" can help manage sequencing risk for pre- and post-retirees (it sounds complex, but it's not). Watch Professor Ron Bird's top-10 rated Conference presentation and you may never tie a manager to a benchmark again. Finally, Lazard asks whether portfolios have enough global small cap equities.

All the best for a great weekend's continuing education - Graham
P.S. Earn up to 17 CE hours via the online Conference 2016 Resources Kit.


This is not the time to stop thinking
While parts of the asset management industry appear to be dumbing down, we must continue to educate individuals on the differences between investment and speculation.
Hamish Douglass, Magellan Financial Group | Resources

Forecasting US recessions - what works and what doesn't
Broad analysis of generally effective indicators of US recessions leads to the conclusion that recession risks in the US are clearly continuing to rise. A wide range of indicators confirm the message although some doubts remain.
Chris Watling, Longview Economics
| Research

Using a bond tent to navigate the retirement danger zone
Perhaps the best way to manage sequence of return risk in the years leading up to retirement and thereafter is simply to build up and then use a reserve of bonds to weather the storm.
Michael Kitces, Pinnacle Advisory Group
| Research

Manager benchmarking is a pox on both investors and markets
It seems sensible to make investment managers accountable by requiring them to perform relative to a benchmark. But this kind of motivation has a perverse effect.
Ron Bird, University of Technology Sydney | 0.50 CE |
* Rated in the top 10 presentations by Conference 2016 delegates

Do you own enough global small caps?
A satellite allocation to global small caps can increase portfolio efficiency over the long term.
Lazard Asset Management |
White Paper

Not their fault
Surely we can't blame central banks for the lack of fiscal stimulus?
Tim Farrelly, farrelly's
| Comment

The failure to understand rebalancing
Of course, to rebalance to the same mix one must sell relative winners since last rebalancing and buy relative losers. In any case, I'm not saying there's something wrong with rebalancing...
Michael Edesess, EDHEC-Risk Institute
| Comment


We must change our legacy for the better
The financial system that we (banks, portfolio managers, researchers, advisers...) bequeath is unstable, un-trusted and built on inappropriate theory with mis-aligned incentives.
Prof Jack Gray, UTS
| 0.50 CE | Resources
* Rated in the top 10 presentations by Conference 2016 delegates

The return of fiscal policy
Central banks have been driven to adopt increasingly unconventional monetary policies - yet most economies are far from where they need to be. We should begin activating fiscal policy.
Nouriel Roubini, Roubini Global Economics |

Desperate central bankers
The lack of response at the zero bound of policy interest rates is hardly surprising. In fact, it is strikingly reminiscent of the so-called liquidity trap of the 1930s. What is particularly disconcerting is that central bankers remain largely in denial.
Stephen Roach, Yale University
1 comment | Opinion

Geopolitics and the consequences of choice
The gravest geopolitical challenge is not terrorism, the Middle East, or Brexit, but an eruption between China and the US, the world's two largest economies and militaries. It is always when the most powerful countries clash that the world is altered fundamentally.
Stephen Kotkin, Princeton University |

The power and limitations of Monte-Carlo simulations
Predicting the future raises a significant number of issues when creating an investment plan. Monte Carlo simulations will illuminate the nature of that uncertainty, but only if those using them understand how it should be applied – and its limitations.
David Blanchett & Wade Pfau
| Opinion

No rebalancing and risk tolerance
Is this just saying that an unrebalanced portfolio will often outperform a rebalanced portfolio because the exposure to the higher returning assets (probably equities) will increase over time?
Tim Farrelly, farrelly's
| Comment

The failure to understand rebalancing
It certainly wouldn't be surprising for a client's risk tolerance to increase as the value of the client's portfolio increases...
Michael Edesess, EDHEC-Risk Institute
| Comment

Currency is the ultimate alternative
It's a good point that it is difficult (but not impossible) to predict a given currency level on a given day. The dynamic hedging decision, though, isn't just about the NZD...
Dori Levanoni, First Quadrant
| Comment


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 and when registration opens for our onstage programs.

Connect with me on LinkedIn
We also let my LinkedIn network know as soon as we release new articles on and when registration opens for our live programs. If LinkedIn is more your thing than Twitter, I'd welcome you connecting. And of course, I'd welcome having a offline direct conversation with you any time.