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PortfolioConstruction Forum







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Friday 27 April 2018


Specialist, independent investment continuing education & certification

Forum Fodder | Friday 21 September 2018
You aren’t learning anything when you’re talking. - Lyndon B. Johnson
All the best for another week's continuing education!
- Graham


The myth of secular stagnation

There are many lessons to be learned as we reflect on the 2008 crisis, but the most important is that the challenge was – and remains – political, not economic. Secular stagnation was just an excuse for flawed economic policies.
Joseph Stiglitz, Columbia University |

Find me some uncorrelated assets!
In the 1950s, Markowitz showed that low or negative correlation is the secret sauce that makes diversification work. While his maths stacks up, the way it is often abused, does not.
Tim Farrelly, farrelly's Investment Strategy |

Today’s flattening yield curve: what does it imply?
The fallacy that an inverted yield curve "predicts" the onset of recessions is alive and well. Many investors believe the curve will invert in 2019, precipitating a recession. But a flattening of the yield curve need not imply a recession.
Woody Brock, SED |

Markets | Strategies
Future proofed portfolios need growth equities
Investors should learn the lessons of history. Looking beyond near-term valuation multiples can help identify the next great winners and also help avoid the losers. Without growth investing, a portfolio is only focusing on only one side of the equation.
Nick Griffin, Munro Partners |
0.50 CE | More

Wayside Side by Side
Portfolio Construction Forum is proud to support the work of the Wayside Chapel. Late last year, many of our members took part in the launch of Side by Side (MC'd by the Forum's Dean, Graham Rich). This year, Side by Side 2018 is a long-table lunch and forum at the Bondi Pavilion, to discuss the cycle of inequality in Australia and explore what we can do to create a fair and equitable society. You will hear from special guests and Wayside's new CEO and Pastor. It is to be a highly interactive experience, where you and your children (ages 10+) can engage in discussions and activities to dig deeper into some of our society’s biggest challenges.
Wednesday 10 October 2018, Sydney | $0 | Register now!

The issue isn't the additional education. The issue is how many units per year, and over a realistic time frame, given the plethora of regulatory imposts advisers are already required to meet, while some clients expect you to work for next to nothing...
Steve Blizard, Roxburgh Securities | More


The makings of a 2020 recession and financial crisis
As we mark the decennial of the collapse of Lehman Brothers, there are still ongoing debates about the causes and consequences of the GFC. By 2020, conditions will be ripe for a new financial crisis.
Nouriel Roubini & Brunello Rosa, Rosa & Roubini Associates |

Markets | Finology
Why we get it wrong - culture not companies dictate trends

Investors need to entirely rethink their processes, assumptions and research approach, to focus on the cultures of consumers in different markets. Only by thinking like new brands themselves, can investors identify and invest in the next powerful trend.
Tassos Stassopoulos, Trinetra Investment Management | 0.50 CE |

The Forum releases its submission to the FASEA CPD proposal
Portfolio Construction Forum's 23-page submission to FASEA in response to its proposed guidance on future CPD explains why the proposal is fundamentally flawed, and falls well short of any reasonable community expectation of FASEA and what drove its formation.
Graham Rich, Portfolio Construction Forum | 1 comment |

Research Review: Small portfolios are beautiful
Markowitz informed us of the risk-reduction advantages of diversification. But just how diversified does an investor have to be to realise almost all of the benefits of diversification?
Ron Bird, University of Technology Sydney | 1.00 CE |

Bonds are no longer a reliable risk diversifier
Simply holding bonds no longer diversifies an investment portfolio, with genuine risk diversification better achieved by exploiting currently under-priced risk premia in volatility and inflation markets.
Gopi Karunakaran, Ardea Investment Management | 0.25 CE |

Pension Funds the biggest risk
Interest rates need to normalise....the market is telling us this....but the economists and money managers have their heads securely in the sand...
Roy Todarello, Rocco Financial Planners | More

FASEA proposals fail to address the P and D of CPD
FASEA's proposed CPD standards will fail to lift the educational standards required of an emerging profession, as they only address the 'Continuing' aspect of CPD, and ignore the crucial 'Professional' and 'Development' elements.
Graham Rich, Portfolio Construction Forum |

Investment crystal balls: broken or imperfect
Investors have long relied on two crystal balls when predicting future returns: equity risk premium and the yield curve. Crystal balls have their place, so long as they are combined with an uncommon degree of common sense.
Amin Rajan, CREATE-Research |

Philosophy | Strategies
Future-proof portfolios are entirely achievable

Future-proofing isn’t about guaranteeing an outcome. No strategy can do that. It's about implementing strategies today that increase the likelihood that multiple objectives, often with different time horizons, can be all achieved.
Rudi Minbatiwala, Colonial First State Global Asset Management |

A future-proof portfolio should guard against pessimism
There will always be movements in markets that we need to be attentive to, and you should construct a portfolio that takes advantage of fear. But don't let that fear drive the dominating principles in your portfolio construction.
Tony Crescenzi, PIMCO |

Electric vehicles are not game changing
Consensus appears to assume that electric vehicle adoption rates will increase dramatically. This view is misplaced. The impact on the oil price and equity market leadership is not something that investors are positioned for.
Stephen Anness, Invesco| 0.25 CE |


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