Beware of the New Systemic Risk
Ashwin Alankar and Michael DePalma It felt like there was nowhere to hide from the market declines last Monday, April 15, when stocks, bonds and commodities fell in unison across the world, well before the Boston bombings that day. We believe that this failure of diversification was instigated by increasingly powerful multi-asset funds, many of which [...]
read moreEmerging-Market Debt Offers More than One Kind of Diversification
One key attraction of emerging-market debt is that it can help investors to diversify existing portfolios of developed-market fixed-income securities. But there’s more than one kind of diversification, and more than one way to approach the opportunity, depending on each investor’s objectives.
read moreReducing the Risk from Adding Stock Exposure
Adding other sources of diversification could significantly reduce the risk from increasing stock exposure, our research suggests.
read moreUK Equities Reach Inflation Tipping Point
Jon Ruff and Patrick Rudden As UK inflation surges ahead, equity investors should be concerned. With yields on inflation-linked bonds at extreme lows, we think real assets offer a better way to combat the risk of rising prices.
read moreWhere SMID-Caps Get Their Performance Muscle
Bruce K. Aronow and James MacGregor SMID-cap stocks, which bridge small- and mid-cap indices, have performed almost as powerfully as small-caps historically, but haven’t been as erratic. The “mid” in SMID is largely why.
read moreEase the Burden of Managing Risk
Risk remains important for many institutional investors, but dealing with it effectively takes time and energy. How investors approach it should therefore depend on their governance capacity.
read moreDefining a New Framework for Equity Investing
Equity investing is facing a crisis of confidence. After several years of high volatility, disappointing returns and the failure of conventional diversification, the fear of equities is pervasive. After all, how can anyone rely on equities to meet future targets when extreme market turmoil can destroy years of careful planning in a heartbeat?
read moreA Survival Guide for Today’s Market
Risk is unusually high these days. Investors can either be paralyzed by uncertainty…or seize the long-term opportunities that volatility creates. We believe the key to choosing the latter path is updating five long-standing investing precepts for today’s tough times.
read moreManager Diversification: Why Conventional Wisdom Is Wrong
There’s a strong case to be made that investors should diversify their exposure to passive managers more—not less—than they diversify their exposure to active managers.
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