Educational Materials

A Look at YieldThis piece provides an introduction to yield and how the low-rate environment has led investors to search globally for new sources of income. It illustrates the importance of dividends as part of an investment’s total return. It also discusses common methods of calculating yield, points out the differences in the calculations, and stresses the importance of making an “apples-to-apples” comparison.
Absolute ReturnsIllustrates how employing absolute return strategies may provide investors with an inflationary hedge and reduce or avoid the negative compounding effect.
Alpha Beta SoupSmart beta is the bridge between the active and passive management. Active managers try to improve performance attributes (alpha) and passive strategies try to deliver performance consistent with a specific category or asset class (beta). This piece discusses both approaches, and highlights the middle ground that may be found by using a factor-based smart beta approach.
Alternative AssetsDiscusses why integrating alternatives into a traditional portfolio should help reduce portfolio volatility and improve the odds of preserving capital over the long term.
Amnesia EffectDiscusses the failed behavior of fear-based market timing and performance chasing, instead of remembering the potential value of diversification, including constant exposure to noncorrelated investments such as managed futures.
Asset Class HistoryA look at the calendar year performance history of various asset classes during the past two decades. In its entirety, this colorful table provides a clear view that asset classes go in and out of favor from year to year, making a powerful case for the potential benefits of diversification.
Asset Class SeasonalityStudying asset class seasonality helps to address the old adage of “Sell in May and go away.” The piece examines if there is statistical truth to the yearly superstition with regard to the stock market and if it also applies to other asset classes. Hopefully, as case is made for the potential value of diversification and long-term investment horizons in an attempt to overcome short-term swings and anecdotal observations.
Betas On The CuspStudies the increasing beta of various asset classes relative to the stock market on the cusp of a credit crisis. And considers taking a Minsky Approach to Modern Portfolio Theory through the use of alternative investments.
Broken IncomeOwning a bond fund is not the same as owning a bond. This piece explains the inherent structural problem with many bond funds and makes a case for using absolute return funds as a possible alternative for portfolio diversification.