Forum Fodder

Portfolio Construction Forum | 22 July 2022

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The Portfolio Construction Forum team



Forum Fodder | Friday 22 July 2022

“We wanted to do what we could to provide insurance for Australians against the potentially catastrophic economic consequences of the pandemic. With the benefit of hindsight, it could be argued that we took out too much insurance.” - Philip Lowe, Governor of the Reserve Bank of Australia (20 July 2022)

All the best for another week’s continuing education!
P.S. Register now! Portfolio Construction Forum Strategies Conference 2022 - The future ain’t what it used to be! Wednesday & Thursday 17 & 18 Aug 2022. Join us in person at our live studio (Sydney), at a live site with a group or via live stream at your desk. Find out more and register



Is the US in recession?
Next week, the US BEA releases its advance estimate of second-quarter GDP growth. Brace yourself for headlines claiming that the US economy is in recession, and all market reactions that will trigger. But do not be surprised if you’re told the opposite two months later.
Jeffrey Frankel, Harvard University | Read


Summers and the great inflation rate fallacy
Harvard’s Lawrence Summers was interviewed about inflation last month. His comments focused on a single entity - the Fed. But fighting the causes of today’s higher inflation is simply not within the Fed’s power.
Woody Brock, Strategic Economic Decisions | Read

Markets | Strategies

Spotlight on the bond bear market
The past 18 months has seen the biggest bond bear market in almost 50 years. In this Spotlight, we look at why bond prices have fallen so much, how this bear market compares with others, and what returns and volatility we are likely to see going ahead.
Tim Farrelly, farrelly’s Investment Strategy | Read


Research Roundtable - Aspect Diversified Futures
This Research Roundtable focused on the Aspect Capital Diversified Futures strategy, a systemic, momentum-based managed futures investment strategy.
Portfolio Construction Forum | 1.50 CE | Read, Watch


Research Review: Two for me
These two papers relate to some interesting quirks of the finance industry. The first finds that the accuracy of currency forecasts is worse than could be achieved from random predictions. The second gives a different slant of the large increase in the size of the financial sector.
Ron Bird, Portfolio Construction Forum | 2.00 CE | Read

Philosophy | Portfolio Construction Forum proudly supports The Wayside Chapel

Inner space
Our universe has been unfolding, expanding and diversifying for well over 13 billion years, and if we marked that on the spectrum of what we’d experience as a year, then our planet was birthed somewhere around September, and we only show up somewhere close to midnight on 31 December. Surely any notion then that we are the centre of the universe also fades in this light.
Jon Owen, Wayside Chapel | Read

Finology | Invitation to investment advisers

Complimentary self-assessment to benchmark your Client Care & Practice knowledge and skills
FASEA requires that financial advisers continually improve their client care and practice knowledge and skills - doing so makes obvious business sense, as well. Our new Finology Benchmarking Indices (FBI) self assessment tool helps you benchmark your investing biases, beliefs and behaviours versus peers, to further empower your “client care and practice” knowledge and skills. It’s complimentary to our members who give investment advice, while we continue to develop it.
Portfolio Construction Forum | 0.50 CE | Take the FBI self-assessment


Markets | Strategies | Investing | Philosophy | Finology

Strategies Conference 2022 “The future ain’t what it used to be!”
AEST Wed & Thu, 17 & 18 Aug 2022
Strategies Conference 2022 will challenge and refresh your portfolio construction thinking, as we debate investment strategies to help you build better quality investor portfolios given the future ain’t what it used to be!
Rarely, a crisis – or combination of crises – heralds a sea-change in global affairs. Such regime shifts reverberate through societies and economies. Back in 2020, Strategies Conference explored the idea that we were entering “a whole new world” due to Covid-19, and debated what that meant for building quality investor portfolios. At the time, not everyone agreed that it was a whole new world. Two years on, more major crises have unfolded, and the new global regime is coming into sharper focus. Times have changed!
The deflationary benefits of globalisation have run their course and deglobalisation is on the rise. Simultaneously, the decades-long disinflationary regime has turned to inflation, and interest rates are on the rise again in many countries for the first time in years. Constructing quality multi-asset, multi-manager portfolios capable of meeting client goals in the years ahead is going to be more challenging than over the past 30 years. Understanding the profound societal and economic changes that are underway and their investment implications is vital.
Join us in person at our live studio, a live site, or via live stream | 14+ CE | Register now!


Markets | As seen at Research Symposium June 2022

Free and fair global markets require shared values
As policymakers begin to craft a new Bretton Woods, and seek to embed the values that liberal democracies want to uphold, practitioners must understand the implications for portfolios.
Rana Foroohar, Financial Times & CNN | 0.50 CE | Watch, Listen


Stagflation is coming!
We may indeed be in for a shortish period of high inflation and low growth - but as to this leading to 1980s-style stagflation? It’s nuts and you can clearly see it’s nuts!
Tim Farrelly, farrelly’s Investment Strategy | Read

Strategies | As seen at Research Symposium June 2022

Today’s market requires an alternative course of action
The next 10 years are likely to be dramatically different than the last 10 years, and investors will need allocations to alternative investments in this challenging environment.
Tony Davidow, T. Davidow Consulting | 0.50 CE | Watch, Listen

Investing | As seen at Research Symposium June 2022

We must invest with a multi-factor mindset
We must take a multi-factor approach to analysing funds – including ESG, Quality, Size, amongst others – to ensure portfolios reflect the investor’s longer-term philosophy and/or shorter term views.
Michael Furey, Delta Research & Advisory | 0.50 CE | Watch, Listen

Finology | As seen at Research Symposium June 2022

We can harness neuroscientific insights to generate alpha
Prolonged exposure to high volatility causes investors to subsequently underestimate volatility (and vice versa), leading to predictability in stock returns - and the ability to construct a trading strategy that exploits the effect.
Elise Payzan-LeNestour and James Doran, UNSW | 0.50 CE | Watch, Listen


Don’t bet on a soft landing
Simply put, the effort to fight inflation could easily crash the economy, markets, or both. The historical evidence shows that a soft landing is highly improbable. A recession in the next two years is likely.
Nouriel Roubini, Roubini Macro Associates | Read

Markets | Strategies

Rising yields are changing the game for investors
Since I addressed Markets Summit 2022 back on 23 February, arguing it was time for a new investing playbook, there has been a major repricing in financial assets. The adjustment has further to run.
Ronald Temple, Lazard Asset Management | Watch, Listen

Markets | Strategies

The stagflation threat is growing
Since I addressed Markets Summit 2022 back on 23 February, arguing “The days of abnormal monetary policy are over”, Russia’s invasion of Ukraine has triggered a food and energy crisis while declining consumer sentiment and Chinese lockdowns provide headwinds to growth.
Jonathan Pain, The Pain Report | Watch, Listen

Strategies | Investing

Spotlight on active management
The arguments for and against active and passive investment management are much more nuanced than is often suggested by proponents on either side.
Tim Farrelly, farrelly’s Investment Strategy | Read

Philosophy | Strategies

Endowment-style investing is as relevant as ever
With stock market valuations close to record highs, and interest rates beginning to rise from all-time lows, traditional portfolios are likely to disappoint in the years ahead.
Thomas Weber, LGT Capital Partners | 0.25 CE | Read, Watch, Listen


Forum CE Library - over 660 CE/CPD hours
Complimentary for all Forum members, the Forum’s online on-demand CE Library offers over 660 CE/CPD hours of accredited learning resources, to help members meet the CE/CPD requirements of 20 governing bodies (regulators, associations, and institutes) including ASIC, APRA, Legislated, FMA, AFA, FPA and CIMA® CE/CPD requirements, to name a few.
Earn CE/CPD hours

Forum CIMA CE Library - over 125 CE hours
This subset of our full CE Library features just those learning resources that are accredited for CIMA CE hours, so CIMA certificants can more easily find learning resources to meet their recertification obligation (at the same time as meeting the CE/CPD requirements of other governing bodies e.g. ASIC, APRA, Legislated, FMA, etc).
Earn CIMA CE hours


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What's new with our live and on-demand continuing education, accreditation and certification programs.

Led by behavioural finance expert, Herman Brodie, the Behavioural Finance - Investment Decision-Making course will help you identify, analyse and evaluate the principal human preferences that influence decision-making in situations of uncertainty, so you can recognise and identify these preferences in others, to improve investment decision-making.