Resources

Planning Through the Generations

Multigenerational planning involves the transfer of wealth, but it also extends to intangible concepts such as family values and legacy wishes. Conversations about multigenerational planning begin with the first generation. The success of an estate plan can depend on whether the details of that plan have been properly communicated to family members. Therefore, it is …Read More.

Don’t get blown off course by a windfall

So you’ve experienced a financial windfall and you don’t know what to do with it. This is what we refer to as a “luxury problem,” right? Indeed, you’d think this would be the most glorious dilemma possible to befall you and your household. But for some, a windfall can be more of a curse than …Read More.

Asset Allocation Guide: How much risk do you need?

CBS News

The first two posts in our series on asset allocation focused on investors’ ability and willingness to take risk. Today, we turn our attention to the third of our three tests, the need to take risk. The need to take risk is determined by the rate of return required to achieve financial objectives. The greater the rate of return …Read More.

Asset Allocation Guide: Dealing with conflicting goals

CBS News

Today we conclude our series on how best to make asset allocation decisions. It’s an easy decision when the analysis of your ability, willingness and need to take risk leads to the same conclusion. For example, one can have a high ability and willingness to take risk but little need. In that case, the answer is simple: Because the marginal …Read More.

Reversion To The Mean Phenomenon: Part IV

Seeking Alpha

This final post of the RTM series will explore the importance of discipline. The academic evidence demonstrates that the determinant of almost all of the risk and return of a portfolio is its asset allocation. It’s important to add that because of recency, the most important determinant of the return that an investor’s portfolio actually produces might …Read More.

Reversion To The Mean Phenomenon: Part III

Seeking Alpha

Our last post looked at the issue of what is expected to happen as a country migrates from frontier to developed markets. We should expect to see the cost of capital fall in such a country. Among the reasons is that regulatory regimes, including protections for foreign investors, are typically strengthened. The falling equity risk premium demanded …Read More.

Reversion To The Mean Phenomenon: Part II

Seeking Alpha

My prior post explored the ninth wonder of the world: reversion to the mean. Today, we continue the discussion on this phenomenon. Forecasting stock returns is a more difficult task than forecasting bond returns. While the relationship only holds at long horizons, what we do know is that valuation metrics such as P/E ratios have had an …Read More.

Reversion to the Mean Phenomenon: Part I

Seeking Alpha

The Seven Wonders of the Ancient World is a list of remarkable constructions of antiquity. They are the Great Pyramid of Giza, the Hanging Gardens of Babylon, the Temple of Artemis at Ephesus, the Statue of Zeus at Olympia, the Mausoleum at Halicarnassus, the Colossus of Rhodes and the Pharos of Alexandria.   Benjamin Franklin …Read More.

The Dividend-ETF Trap

ETF

  Over the last few years we’ve seen a dramatic increase in interest in dividend-paying stocks. The heightened interest has been fueled by both the media hype and the current regime of interest rates that are well below historical averages.   The low yields available on safe bonds led even many once-conservative investors to shift …Read More.

Faint Praise For 130/30 Funds

ETF

Hedged (long/short) mutual funds are the money management industry’s answer to illiquid hedge fund strategies. The premise of long/short funds is that the managers can apply their security-selection skills to a broader opportunity set, which is to say they can go both long and short, instead of long only. The broader opportunity set should make …Read More.

The Secret to Picking Actively Managed Mutual Funds

Huffington Post

If you are a regular reader of my blog, you know I recommend against buying anyactively managed mutual fund. Instead, I advise investing in a globally diversified portfolio of low-management-fee index funds, passively managed funds or exchange-traded funds (ETFs), in an asset allocation suitable for you. Investors are looking at the data and getting the message. According …Read More.

A Surprising Spin on a Bad January

Huffington Post

There was much hand-wringing about the poor stock market returns in January. The financial media engaged in its usual frenzy of speculation about whether these results meant we were in for a “correction” or worse. Typical of the financial babble about the “significance” of January returns is this silly observation by Matt King, chief investment officer at …Read More.




Our Offices
©2019 KEB Asset Management