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Portfolio Construction Forum







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Friday 23 March 2018

Specialist, independent investment continuing education & certification

Fodder kicks off with Yale's Professor Robert Shiller calling for governments to issue GDP-linked bonds as insurance against future economic crises. Chris Watling's top five-rated presentation from Markets Summit explains that a new economic paradigm is overdue. Macquarie Uni's Joanne Earl presents her latest research, looking at the reasons and effects of retirees downsizing. Mercer's David Knox revisits whether Don Ezra's 10/30/60 rule still applies in Australia for retirement planning. And we close with a short, pithy insight from Lazard Asset Management's Ed Rosenfeld arguing the upbeat outlook for small caps.
- All the best for another week's continuing education - Graham
P.S. You can catch more of
Finology Summit 2018 - Where investing meets investors - online (and earn further CE). More


The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn. - Alvin Toffler


Markets | Strategies | Investing
IMR Workshop 2018 - advancing investment management research
Now in its 10th year, the annual Investment Management Research Workshop showcases early stage investment management research.
1.30pm-6.00pm, 12 April | 4.00 CE (ASIC/CIMA, etc) |


Markets | Investing
Making the case for sovereign GDP-linked bonds
The time has come for national governments around the world to start issuing their debt in a new form, linked to their countries' resources.
Robert J. Shiller, PhD, Yale University |

Things (in the economics world) are broken
The history of the international monetary order is a history of change, occurring on average every 40 years. This current system is, therefore, long in the tooth.
Chris Watling, Longview Economics | 0.50 CE |

Revisiting the importance of investment returns in retirement
About 30 years ago, Don Ezra identified the 10/30/60 rule for what drives retirement income. Does this rule still apply in Australia?
David Knox, PhD, Mercer |

Downsize now and rejoice at leisure.
Government incentives may help to encourage downsizing but the decision itself may not be purely financial as recent research reveals.
Joanne Earl, PhD, Macquarie University | 0.50 CE |

Small caps are thriving in the global upswing
Smaller companies are benefitting from robust economic growth, low base rates and balance sheet flexibility. Investors should focus on Japan and Europe.
Ed Rosenfeld, Lazard Asset Management |

True diversification is key
Well written, Michael - we are often attempting to help advisers understand the importance of combining lowly correlated assets (that have positive long-term drift) to achieve more robust portfolio outcomes...
Andrew Fairweather, Winston Capital Partners
| More


Behavioural biases lead to unrecognised risk-taking
Behavioural biases - substitution, aggregation, and feedback risks, overconfidence, and limited attention and availability bias - distort money managers' perceptions and lead them to take risks they don’t see.
Terrance Odean, University of California, Berkeley | 0.50 CE |

Economists vs scientists on long-term growth
Neither policymakers nor markets should be betting on the slow growth of the past decade carrying over to the next. The best bet is that AI and other new technologies will eventually come to have a much larger impact on growth than they have up to now.
Kenneth Rogoff, Harvard University |

Philosophy | Strategies | Investing
Diversification - what it is and is not
The concept of diversification may seem to be second nature. However, some of its fundamentals are often misused and sometimes misrepresented.
Michael Furey, Delta Research & Advisory |
1 comment | More

Markets | Investing
Investors need growth equities as change accelerates
Structural change and the resulting earnings growth will always outrun interest rates in the long run, so as change continues to accelerate, investors need growth equities in their portfolio.
Nick Griffin, Munro Partners | 0.50 CE |

Latest US stimulus is a red flag
There is now a 50% chance that the US Federal Reserve will hike interest rates more sharply than markets expect, leading to a recession in the next one to two years.
Brett Gillespie, Ellerston Capital | 

Efficiency argument misses some important elements
The characterisation of blockchain as being about technological efficiency is not a sufficient way to think about it...
Julian McCormack, Platinum Asset Management
| More

I'd love to know how the 33.3% intend to do that???
Glynn Phillips, Falconer Advisers
| More

The blockchain pipe dream
It is high time to end the hype. Bitcoin is a slow, energy-inefficient dinosaur. Most of the coins are little different from railway stocks in the 1840s, which went bust when that bubble – like most bubbles – burst.
Nouriel Roubini, Roubini Global Economics |
1 comment | More

Markets | Investing
Cryptoassets is an emerging asset class with huge potential
Technological revolutions often spawn financial booms and busts - but the value proposition of blockchain is profound, and the technology has given rise to cryptoassets. Practitioners will increasingly be required to understand them.
Catherine Wood, Ark Invest | 1 comment

Ignore the exit ramp, better conditions ahead
The US might have three to five years of additional growth ahead. Global synchronised growth is likely to drive earnings growth to a higher gear that warrants current elevated valuations.
Ron Temple, Lazard Asset Management | 0.25 CE |

Beware the Bond-cano!
The peddlers of the Bond-cano narrative give very different recommendations. Even if we buy the story, it's just not clear what to do - all of which suggests that it is just a wonderful narrative.
Tim Farrelly, farrelly's |

The finologist of the future is a cyborg
The combination of man and machine - tech-augmented humans or "cyborgs" - can be more effective than either alone, posing the greatest opportunity to human financial advisers in the long run.
Michael Kitces, Nerd's Eye View | 0.50 CE |


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