Category: United States

Most active equity funds do not underperform for lack of stock-picking skill. Rather the investment industry incentivizes them to manage business risk at the expense of long-term portfolio performance.

Forecasts in the form of Monte Carlo simulations are not the best way to anticipate a client’s future portfolio returns.

“It is possible to construct equity portfolios that possess out of sample exposure that facilitate more precise targeting of levels of macroeconomic risk exposure.”

While investment consultants may claim their advice is conflict-free — and their clients may believe them — it is often heavily biased by the investment consultants’ own self-interest.

An examination of global stock market indices since 2015 reveals one clear takeaway: Every single index’s average correlation with all other indices has fallen.

Not all low volatility strategies are created equal. Many lack the diversification and risk control needed to guard against concentration and macro risk.

Climate risks and the CRE loan market have many points of intersection that spotlight the urgent need for community and regional banks to recalibrate their risk assessment frameworks.

In the Financial Analysts Journal, Emmanuel R. Pezier and Paolo F. Volpin analyze a private dataset of a UK fund’s engagements with small-cap newly public firms and demonstrate that “behind-the-scenes” engagements resulted in 8% to 10% in cumulative abnormal returns.

The cannabis industry constitutes a new frontier in investing and is ripe with growth opportunities.

Mark J. Higgins, CFA, CFP’s epic book offers invaluable context for forecasting the direction of the economy and the market.