Recently, I attended the Eureka Report Around the World of Investing Forum. The overwhelming impression was that global investing is very new to many Australians.
It is not beyond the realms of possibility that the "prudent person" approach to playing it as safe as possible in portfolio construction might undergo a significant shift.
PortfolioConstruction Forum Academy Spring Seminar 2014 features three sessions. This Resources Kit contains the materials for preparing for the Seminar. After the Seminar, it will also contain the presentations for each session.
Perhaps the most crucial change in our retirement planning language is simply to rename "retirement".
The dynamic duo (Kitces and Pfau) are back in their search for the ultimate truth about retirement income planning and how to structure portfolios to minimise drawdowns.
What do Richard Nixon, novel "Zen and the Art of Motorcycle Maintenance", and Bridgewater Associates have to do with risk parity investing and Conference 2014?
As the first day of our annual Conference program, we hosted the Finology Forum. Our particular focus of finology was as it applies to the giving of investment advice.
The one-day Conference Finology Forum 2014 program (within the overall three-day Conference program) featured leading investment thinkers from around the world presenting on how to more effectively help investors manage their expectations and investment portfolios. This CPD Quiz is for delegates to complete, to receive CPD accreditation.
This presentation addresses the importance of developing improved and dynamic investment approaches that seek to better understand and manage total portfolio risk as well as identify sources of return.
Individuals are vulnerable to economic and financial risks as they approach and enter retirement. Insights from behavioural finance can be used to enhance risk communication and retirement outcomes.
If geopolitics is far more important in considering investment markets today, how do we integrate geopolitics into portfolio construction?
As we sit today with some unprecedented market conditions, it's probably more relevant than ever to understand both sides of the risk and return equation in the fixed income space.
A sustained period of lower global growth, rich valuations from traditional assets and an eerie calm before the storm in asset price volatility require a different approach to asset allocation.
To ensure risk is genuinely well diversified takes a forward-looking scenario-analysis process to combine quantitative rigor with qualitative insights of the plausible but unlikely extreme stresses we might face.
The last decade has seen a distinct disconnect between investment risk and return, versus what we're taught should be the case.
What are the questions that everyone is asking today? When will interest rates spike? And, what about the increased rate of inflation? One has to accept the changing nature of these two elements.
The constant challenge is to keep clients focused on their wealth goal when they are distracted by the many other factors that influence their perception of risk.
Alpha Potential is gaining traction as a tool to identify opportunities for active management, enhancing the value proposition afforded to active managers.
This paper reviews the principles, practices, risk management requirements and implementation steps needed to build absolute return focused portfolios.
To ensure risk is genuinely well diversified takes a sophisticated forward-looking scenario-analysis process to combine quantitative rigor with qualitative insights of extreme stresses it might face.
This paper explores the thesis that capturing the traditional relationship of fixed income in the total client portfolio will require more untraditional approaches going forward.
Six stocks make up just under half of the Australian equity market. This research paper examines the impact of this on investors' returns, and whether it is responsible investing.
This research paper discusses (in simple terms) how to reconnect the concept of Risk and Return via the practical application of volatility derivatives to portfolios.
This paper explores the opportunities within private equity and private debt and examines their role in providing downside protection for investors.
Over the past 40 years, the high-yield landscape has grown exponentially. Knowing the key risks and emerging opportunities can help map a path forward.
Uncertainty about the timing of future interest rate rises poses challenges to fixed income investors. This paper identifies options available in managing portfolios in such an environment.
We've come to accept a world where the US drives what happens in the global economy and markets. But that's changing - with significant implications for portfolios.
It is not surprising that bond managers have significant difficulty in outperforming a market cap-weighted benchmark.
Do geopolitical events involving potential or actual military conflict really matter in the constructing of investment portfolios?
Symposium NZ 2014 facilitated debate on the three pillars of portfolio construction – markets, strategies and investing - to help delegates build better quality portfolios. This CPD Quiz is for delegates to complete, to receive Structured CPD Hours.
The staple of retirement planning - save a percentage of income - makes it surprisingly difficult to ever reach retirement. The alternative is much easier and more successful.
PortfolioConstruction Forum Academy Winter Seminar 2014 featured four sessions: Risk, return & relating; Statistics, lies, and investment performance analysis; How safe are safe withdrawal rates in retirement?; and, Communicating and learning with and from clients.
What we are witnessing in Iraq is a war within Islam. Will it mutate into a broader regional war thereby threatening oil supplies?
Investing differently gives no certainty of great results (increasing the odds of being wrong as well as right). But it is a necessary but not sufficient ingredient for great performance.
Across the industry, portfolio rebalancing is the norm - with little agreement on the optimal frequency. So I experimented to find out which frequency is best.
Most research assumes retirees maintain a consistent standard of living. A new study disproves this, implying we may be overestimating funds needed to retire by up to 20%.
Our Symposium NZ 2014 faculty debated that the best way for practitioners to manage a client's primary risk of not meeting their objectives is to manage the long-term uncertainty of returns.
Are the human and organisational barriers to being better investors insurmountable, or can we learn and improve our decision-making?
Typically, MPT has focused solely on how to invest within classes, not amongst them. But MPT continues to evolve.
This paper and presentation provide an introduction to the risk tolerance paradox, exploring the main reason it exists, and introducing risk management strategies that seek to solve the problem.
This paper and presentation argue that the bond market can offer compensation against rising rates through roll down and active management of forwards.
Understanding what is going on under the bonnet at central banks is key to understanding what will drive markets – and therefore how to best position portfolios.
While it is well established that equity valuations impact medium-term equity returns. It is less well known that starting period equity valuations also impact medium-term equity volatility and bond-equity correlations.
There is huge variety in retirement income strategies. This paper introduces "longevity risk aversion" and its impact on safe withdrawal rates.
Towers Watson's compendium of insights into global equity investing contains useful insights about issues many portfolio construction practitioners face every day.
The Academy Autumn Seminar 2014 featured four sessions: 10 golden rules for portfolio construction; Reassessing the global debt spectrum; Currency revisited - to hedge or not to hedge; Volatility investing - the next frontier.
Target date funds are becoming the workhorse for DC plans but there are problems with the approach. This paper offers a portfolio construction framework to overcome them.
In recent months, we've highlighted one school of research on funding retirement income, being the sustainable withdrawal rate approach. This paper takes a different approach.
Does Fama and French's latest work, A Five-Factor Asset Pricing Model, provide any information that can be of practical value to advisers or investors? The answer is no.
As the logic goes, retired clients deplete their portfolios, and more pass away as the years go by, so a firm with aging clients is akin to a rapidly depreciating asset. But is this true?
It's the eternal debate - can active management outperform? Two recent reports offer some interesting insights into the issue.
A new research paper looks specifically at withdrawal rates in the Australian context, confirming the legislated minimums for account-based pensions are much too high.
This Resources Kit is a deluge of videos, podcasts, and papers for all 18 sessions of the jam-packed Markets Summit 2014 program - The Great Escape (what will markets be like in the QE runout?) so you can "attend" even if you weren't part of the 500-strong audience.
In rapid-fire presentations, 18 experts from various parts of the world debated the biggest issue facing the financial world.
Our Markets Summit faculty debated two critical issues arising from Unconventional Monetary Policy; for the coming two to three years, to substantially overweight DM vs EM Equities in portfolios and substantially overweight Short vs Long Duration Bonds.
Emerging Markets were a focal point in 2013, repricing as US stimulus, commodity prices and China's boom subsided. In future, EM performance will depend on individual merit.
To achieve the Great Escape, central banks must first complete the Great Unwind – the removal of ultra-easy monetary policies. So what is the roadmap for the Great Unwind?
Breaking Unconventional Monetary Policy (B.U.M.P.) and it's impact on global financial stability is the key risk for the foreseeable future.
The ability to pick inflection points in markets as well as deploying TAA across credit will be the key ingredient going forward.
Short-term rates are likely to remain low for a prolonged period of time. Investors will still need to source yield, they'll simply have to be more creative to find it.
Today's long period of very easy money and very low yields has distorted the financial system. This will cause unintended consequences in the near future as QE ends.
William Bengen established the 4% rule - and showed a higher exposure to equities was better for retirement portfolios.