In the old days deciding how to allocate a portfolio came down to a decision on stocks vs. bonds. With all the new ETFs and other investments out there it is becoming more and more difficult. Now investors have access to commodities, currencies, alternative strategies, etc. There a number of ways to decide how to […]
Do It Yourself Model Gaining Ground on Advisers What a shock, after not protecting investors from declines in 2002 and 2008 and spouting the same old modern portfolio theory that has never worked, that investors would start deciding to go on their own.
Was 2011’s Most Successful Hedge Fund Actually a Pension Interesting article in aiCIO about how a Danish Pension fund made 20% in 2011. Interesting to me in the fact that they use a risk parity approach vs. the traditional asset allocation approach. One telling quote: Out of habit, I ask him about what asset classes […]
We are big believers in staying in harmony with the market trend so we don’t try to get out at the top, but we do keep track of various signals that tend to be good indicators of market movements. We haven’t seen any of these signals in months, untl today. Today we saw an anticipatory set of […]
Morningstar wrote a critique yesterday about Tactical Mutual Funds. Here’s a Reality Check for Investors Considering Tactical Funds. While they do make some valid points there basic conclusion that people don’t need to add tactical funds to their portfolios leaves the average investor with the same asset allocation advice that got them crushed in 2002 and […]
The VIX (volatility index) has jumped 10.4% so far today on a less than 1% pullback on the S&P. Shows that maybe the pros are getting a bit nervous.
Risk Parity Funds-WSJ.com Interesting article in the WSJ about risk parity funds this morning. We are big believers in the approach but as the article points out there are some problems—high use of leverage, large exposure to bonds in a low rate environment, not taking macro risks into account. To some critics, the funds’ assumptions […]
Itchy Investors Ramp Up The Risk-WSJ.com The longer the Fed leaves interest rates low the more it hurts people who save money in CDs and bank accounts. The Federal Reserve is presenting a broad swath of conservative investors, from retirees and college savers to banks and insurance companies, with a tough choice: move into riskier […]