Category Archives: Weekly Roundup

Investment Management Roundup – Week Ending 1.9.15

Happy 2015! If one of your resolutions is to keep up-to-date on industry thought leadership, you’ve come to the right place. Early January ‘tis the season of prognostication. This week, we round up the best of the best thinking from industry pundits who offer their unique—and sometimes conflicting—perspectives on what lies ahead in the New Year!


“Gross: Good times over, markets set to fall. Bond guru predicts minus signs for many asset classes”
Bloomberg News | Investment News| | 1.6.15

Bill Goss“While timing the end of a bull market is difficult, the next 12 months will probably see a turning point. … Knowing when the ‘crowd’ has had enough is an often frustrating task, and it behooves an individual with a reputation at stake to stand clear,” [Bill Gross] wrote. “As you know, however, moving out of the way has never been my style.”
Mr. Gross said investors should hold high-quality assets with stable cash flows, such as Treasuries, high-quality corporate bonds, and stocks of companies with little debt and attractive dividends.”

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Investment Management Roundup – Week Ending 12.19.14

The countdown begins! This week’s Roundup focuses on the future, as we share some of the industry’s most compelling prognostications about the state of active management for the new year.

Here’s hoping that the Santa Effect brings you lots of goodies at year-end. See you in 2015!


“Torrid times for active fund managers”
David Oakley | Financial Times | | 12.18.14

Cartoon: Become an active manager and learn to fly“Research by academics Martijn Cremers and Antti Petajisto, published in 2009, demonstrated that the more active fund managers were, the more successful they were likely to be. In other words, the less a portfolio looked like an index, the more potential it had for generating excess returns above the market. This suggested that investors should avoid the benchmark huggers among the active managers and go for those running unconstrained funds.”

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Investment Management Roundup – Week Ending 12.12.14

This week’s Roundup brings you investment insights about emerging market factor investing, why short-termism gets short shrift from the pundits, as well as a new way to think about performance attribution. Also included is information about how an in-house style guide helps reinforce your brand with clients and prospects. And don’t miss our Funny Friday item, “17 signs that you were a CIO in 2014.”

Happy reading!


“‘Factoring’ in the Emerging Markets Premium”
Raina Oberoi, et. al. | MSCI Equity Research | | November 2014

Factoring in the Emerging Markets Premium“In the last decade, style and industry factors have become significant components of returns, eroding some of the dominance of country factors. As a result, investors have started exploiting style factor premiums. Far less research, however, has been devoted to whether factor indexes also ‘work’ in emerging markets. This paper seeks to uncover the drivers of performance for factor indexes in emerging markets.”

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Investment Management Roundup – 12.5.14

This week’s Investment Roundup kicks off the countdown to year-end 2014 with a directory of behavioral biases from The Psy-Fi- Blog— now you can smile knowingly when a colleague throws around terms like “Akerlof’s Lemons” and “Jevons’ Paradox.” CIO Magazine explores a new benchmarking approach that Norway’s sovereign wealth fund claims can boost the benefits of active stock-selection. Tom Brakke casts a critical eye on our reluctance to be proactive about future catastrophic risks — which, depending on your own biases, could be an example of Procrastination, Zero-risk Bias, Disaster Myopia, Illusion of Control, Risk Aversion or the Titanic Effect. And much more!

Happy reading.


“The Big List of Behavioral Biases”
The Psy-Fi-Blog| | 11.14.14

Anchoring“Over the hundreds of articles published on the Psy-Fi Blog we’ve generated a long list of examples of behavioral biases, which is now collated in The Big List of Behavioral Biases. It’s an extraordinary compendium of irrationality, an imperfect register of the various strange ways in which rational economics goes astray”
You can find the Big List of Behavioral Biases here:

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Investment Management Roundup – 11.21.14

Released this week, State Street’s Center for Applied Research new report finds professional investment decision-making processes are at odds with successful outcomes. Morningstar deconstructs uses and abuses of style-box management, and an interview with top advisors finds passive and active co-existing nicely. Marketing guru Bruce Frumerman outlines what consultants really want from a manager presentation, and Dr. Wesley R. Gray synthesizes new research that shows doubling down on underperforming stocks pays off.

All of us at Assette wish you and yours a safe and happy Thanksgiving!!


“The Folklore of Finance: Beliefs That Contribute to Investors’ Failure”
Paul Sullivan | The New York Times|| 11.14.14

The Folklore of Finance“WHEN most people think of folklore, they think of ancient stories passed down through the ages. The tales may be instructive, amusing or both, but few take them as entirely true. Still, they represent an oral tradition that once helped people make sense of the world.
After a nearly two-year study that aimed to answer the question, What does true investment success look like?, Suzanne Duncan, global head of research at State Street’s Center for Applied Research, and her team found that the way individual and professional investors made investment decisions was so skewed that achieving both high returns and long-term objectives was nearly impossible.”

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Investment Management Roundup – 11.14.14

It’s been a tough year for managers, but don’t give up on an active approach quite yet. Pundit David Snowball derides passive management as a “fantasy,” and FT’s John Authers cites benchmarking as the root of market distortion. Quant guru Jack Vogel examines ways to hedge against drawdowns, and Tom Brakke urges asset owners to be more critical consumers of their managers’ marketing narratives.

And, if you find fee negotiations and disclosure requirements tedious, you can always adopt online investment management firm Aspiration’s approach and just let clients pay what they want.

Have a great weekend!


“Fewer active managers beat market than at any time in decade”
Stephen Foley | Financial Times| | 11.10.14

Fewer fund managers are beating the market this year“Fewer fund managers are beating the market this year than at any time in over a decade, piling further misery on a profession that faces increasing investor skepticism. Fewer than one in five active managers outperformed the stock market in the year to the end of October, according to figures compiled by Bank of America. Some of the most widely held shares have been weak this year, amid an equity market rally powered by less well-loved blue-chip companies, and managers appeared to compound their poor decisions during last month’s volatility.”

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Investment Management Roundup – 11.7.14

Do you think market volatility is here to stay? Can it be harnessed to an investor’s advantage? This week’s Investment Management Roundup looks at what industry experts are saying about the relationships between risk, return and volatility. We also include some practical advice on how to weave a compelling story into your next client presentation.
Have a great week!


“The risk machine”
Tom Brakke| tjb research| The research puzzle blog || 11.3.14

Risk/Return Tradeoff“Thirty years ago, scatter plots of asset class forecasts (as well as those fancifully precise efficient frontiers) were charted with a Y-axis labeled ‘return’ and an X-axis labeled ‘standard deviation.’ Over time, ‘volatility’ replaced ‘standard deviation,’ but in many of today’s versions, the X-axis is marked with a different, loaded, word: ‘risk.’”

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Investment Management Roundup – 10.31.14

Is it time for passive investors to come clean about the downside of their approach? Is institutional fund management more complex than it needs to be? Why are pension fund execs around the world so confident they’ll hit their 5-year targets? Find out in this week’s Investment Management Roundup. We also include a critical analysis of common value metrics and some wise words for marketers about the fine line between provocative and obnoxious. And if you’re struggling with what to wear to that costume party this weekend, there’s no better inspiration than the Witch of Wall Street!
Happy Halloween!


“The dark side of passive investing”
David Blitz| Head, Quantitative Equity Research | Robeco Asset Management| The Journal of Portfolio Management | Volume: 41, Number: 1 | Fall 2014

The Dark Side of the Money“If everyone tried to adopt passive investing, the link between prices and fundamentals would break down. Liquidity would also disappear, as the capitalization-weighted market portfolio reflects a buy-and-hold approach that requires no trading (apart from new issuance, of course). True passive investing is actually impossible.”

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Investment Management Roundup – 10.24.14

Are asset managers suffering from group think? Is perfection the enemy of good when it comes to the active vs. passive debate? Is Harry Markowitz a closet equal-weighter? Find out in this week’s Investment Management Roundup. We also include a recap of risky asset class performance in the wake of this month’s volatility, new models for creating an effective content marketing campaign, and a parable about what not to do when life hands you a nice, cold lemonade.
Have a great weekend!


“A Skeptic’s View of Today’s Religion”
Angelo Calvello | CIO Magazine | | 10.20.14

David Hume, Scottish philosopher, historian, economist, and essayist known especially for his philosophical empiricism and skepticism.“I have criticized asset management’s business models, culture, and compensation structures; the academy’s lack of imaginative scholarship; and asset owners’ and managers’ behavioral biases as being at the root of this situation. To this list I add group think, not as an episodic predisposition but a religious fundament: There exists an organized, shared belief system derived from ‘ancient’ scripture that explains the meaning of ‘life,’ promulgated by a group of initiates and scholars.”

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Investment Management Roundup – 10.17.14

Where will the asset management industry be in 2020? What is keeping boutique asset managers from growing? Should you be concerned about this month’s spike in volatility? Find out in this week’s Investment Management Roundup. We also include some of the latest thinking on GIPS standards, an invitation to the Financial Modeling World Championships, and a funny-pathetic cautionary tale about trying to pull the wool over the eagle eyes of SEC reviewers.
Have a great weekend!


“Asset Management 2020: A Brave New World”
PWC | | 2014

Brave new world“Amid unprecedented economic turmoil and regulatory change, most asset managers have afforded themselves little time to bring the future into focus. But the industry stands on the precipice of a number of fundamental shifts that will shape the future of the asset management industry. To help asset managers plan for the future, we have considered the likely changes in the asset management industry landscape over the coming years and identified key gamechangers which will impact the competitive environment.”

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