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Latest Investment Strategy News
Tuesday, 9 February 2010
Investors must consider the rising impact of public policy on financial markets when constructing investment portfolios as governments start to play a bigger role in the market. Read more
Tuesday, 9 February 2010
Indonesia, Tanzania and China reported the fastest growing output for gold last year - usurping South Africa, once the world's largest gold producer, which saw its production levels drop 5 per cent, according to a precious metals expert. Read more
Tuesday, 9 February 2010
Institutional investors and financial planners will soon be able to access locally listed sector-based exchange traded funds (ETF) after Australian Index Investments (Aii) announced plans to launch six ETFs to the market in the next three months. Read more
Videos
In an environment where interest rates look set to rise, the Decision Makers explore how advisers should be looking at the cash component of their client portfolios. Watch
Current Edition
The Journal of Investment Strategy (JIS) is produced by Financial Standard a division of Rainmaker Information and aims to serve as a conduit for theoretical and empirical research from academics and ... Read more
Perspectives
The losses reported from the so-called sub-prime category and the collateral damage suffered by some councils has brought renewed scrutiny of their financial viability and the investment practices which ... Read moreThe losses reported from the so-called sub-prime category, and the collateral damage suffered by some councils, has brought renewed scrutiny of their financial viability and the investment practices which are employed across the local government sector. The diversity of prudential investment standards which currently apply in Australia also suggests that the investment policies expected to deliver optimal economic outcomes for rate payers require reform. In conjunction with the moves to address the financial sustainability of the sector, this paper argues that reforms are needed to standardise investment powers, empower councils to develop appropriate investment objectives, and to centralise funds management.
The degree of competition in the Australian banking and non-banking lending sectors is critical to both enhancing housing affordability as well as providing an efficient supply of funds to both corporates ... Read moreThe degree of competition in the Australian banking and non-banking lending sectors is critical to both enhancing housing affordability as well as providing an efficient supply of funds to both corporates and small and medium enterprises (SMEs). It is with this firmly in mind that we make this submission to the House of Representatives Standing Committee on Economics and its Inquiry into Competition in the Banking and Non-Banking Sectors.
The tide of articles on inter-generational themes in financial services literature has fallen away in recent times. Perhaps the topic has been overdone or more probably climate change oil price hikes ... Read moreThe tide of articles on inter-generational themes in financial services literature has fallen away in recent times. Perhaps the topic has been overdone or, more probably, climate change, oil price hikes, the credit crunch, the economic slowdown, the savage fall in equity markets and increased volatility have all taken the headlines away from it. The latter phenomena flare more brightly and correct more sharply than slower working forces like demography, but the pendulum will swing back at some time because intergenerational issues remain important.
Aspects
Oil traders in New York don't often get a chance at world-wide fame. But for Richard Arens a one-man band in the world of oil brokerage it came at the beginning of this year. On the first Wednesday in ... Read moreOil traders in New York don't often get a chance at world-wide fame. But for Richard Arens, a one-man band in the world of oil brokerage, it came at the beginning of this year. On the first Wednesday in January, financiers and governments across the globe watched anxiously as the price of oil edged towards the historic $100-a-barrel mark. Arens saw his opportunity and seized it.
CFA Institute formed the CFA Centre for Financial Market Integrity (the "CFA Centre") to explicitly support the CFA Institute mission to lead the investment industry in setting the highest standards of ... Read moreCFA Institute formed the CFA Centre for Financial Market Integrity (the "CFA Centre") to explicitly support the CFA Institute mission to lead the investment industry in setting the highest standards of ethics and professional conduct. Asset managers in particular hold a unique place of trust in the lives of millions of investors. Investment professionals and firms who undertake and perform their responsibilities with honesty and integrity are critical to maintaining investors' trust and confidence and upholding the client covenant of trust, loyalty, prudence, and care. CFA Institute and its members are committed to reinforcing those principles. To foster this culture of ethics and professionalism, the CFA Centre offers this voluntary code of conduct. It is designed to be broadly adopted within the industry as a template and guidepost for investors seeking managers that adhere to sound ethical practice.
AXA Rosenberg has a 23 year history of valuing large universes of stocks using a fundamental approach and constructing portfolios using quantitative techniques. In this article we set aside the role of ... Read moreAXA Rosenberg has a 23 year history of valuing large universes of stocks using a fundamental approach and constructing portfolios using quantitative techniques. In this article, we set aside the role of active management in adding value above the market return and focus instead on the attraction of the global equity asset class as a whole for investors, particularly relative to long-dated bonds.
Active portfolio management is the art of balancing risk and return. In the absence of arbitrage or inside information an active manager must take on risk in order to achieve an excess return that compensates ... Read moreActive portfolio management is the art of balancing risk and return. In the absence of arbitrage, or inside information, an active manager must take on risk in order to achieve an excess return that compensates clients for the fees charged. The term "balance" insinuates that half of the art of portfolio construction lies in stock selection and the other half in risk management. It is therefore interesting to consider how one-sided the majority of fund management efforts are with regards the mix between research and portfolio construction. Despite recent trends to incorporate deeper risk understanding in the management of portfolios, the degree to which risk is actually viewed all too frequently comes down to little more than compliance adherence and tracking error recognition. In this paper we aim to demonstrate that this approach to portfolio risk management is a far from optimal as reliance upon tracking error as the primary, or worse, sole risk metric is subject to two key problems.
Most in the financial industry will recall the impact that the tech bubble had on the share market during the late nineties. Jeremy Siegel (2006) makes the point that in early May 2006 the price weighted ... Read moreMost in the financial industry will recall the impact that the tech bubble had on the share market during the late nineties. Jeremy Siegel (2006) makes the point that in early May 2006 the price weighted Dow Jones Industrial Average index approached its all time high. Yet large cap weighted indexes - such as the S&P 500 or the Russell 3000 - in which most investors hold their indexed investments were still substantially below their peaks of March 2000. Siegel questions, "Whether there is a better way to capture the market's return without enduring the wild swings that characterised the last bubble." He then goes on to state that "we are on the verge of a revolution: new research demonstrates that it is possible to construct broad-based indexes offering investors better returns and lower volatility than capitalisation-weighted indexes."
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