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Endowments and foundations typically are considered the early adopters in alternative investments. Watch this video with CAIA Association's Director of Curriculum Keith Black, PhD, CFA, CAIA, as he explains the different structures of endowments and foundations and why they are uniquely geared for successful alternative investing.
Operational risk within investment management firms can stem from many sources. Firms also have varying tolerance levels for accepting or handling such risk. SEI believes virtually every firm can benefit from taking a fresh look at common areas of risk and consider the variety of relatively straightforward risk management measures that can readily be deployed. In that spirit, SEI put together a 10-part guide as an effective risk management tool to set the foundation for operational excellence. Below are excerpts ...
By Charles Skorina In our last letter we took a hard look at recent investment performance among the eight Ivy League endowments. [See NL44 at http://www.charlesskorina.com/775/] As a bonus we added four "Alt-Ivys" to round it up to an even dozen. These are all, of course, privately-funded institutions. Now, we turn to the cream of our state-supported schools, the twelve Public Ivys. The traditional Private Ivy endowments, including Harvard and Yale, get lots of scrutiny for obvious reasons. They control a lot of money; they're ...
When I think of a “road map” I have a very old-school image in mind, one of those fold-up things drivers used to keep in the glove compartment before new-fangled talking-dashboard computers came into our world to give us turn-by-turn directions.
It is with that older image in my head that I read what John T. Hailer, chief executive officer of Natixis Global Asset Management, said in a release. “The old roadmap no longer guides investors and the new one is being drawn every day.”
Hailer was summarizing the results of a ...
The archeologists of the distant future will no doubt tell of the great 21st shift of the human race from terra firma into cloud cities. Or, at least, the business jargon of our day makes it seem as if exactly that shift is underway. This is clear for example, from Celent’s new report on the future of cash equities trading operations.
The report begins with certain well-known facts about the equities business for brokerages in the 21st century. It is low in revenue, high in cost, and imposes capacity challenges.
As a ...
A new white paper from Deutsche Bank Markets Research cautions traders that although they can enhance the value they get from traditional quantitative signals by overlaying information from the web and news sources, the use of such sources is far from a “magic bullet.” Its efficacy will be somewhat less than its enthusiasts circa 2009 hoped.
At that time, “news sentiment and natural language processing was one of the hottest topics in quant” they write. The new tools have lost some of their mojo since, and the mavens of Deutsche Bank ...
A financial transaction tax goes into effect in some parts of the EU on January 1, 2014: unless, that is, the Powers that Be can prevent it. That would be … the same powers that have brought it this close to implementation.
The proposal is for a levy of 0.1% on stock and bond trades and a level of 0.01% on trades in derivatives. That may seem small but, as Clifford Chance observed in a briefing note in February 2013, the “cascading” design of the tax, the way it would apply ...
By Diane Harrison A universal theme in alternative assets is investor money looking for a place to land. Uncommitted cash, underperforming assets, and professional laggards throughout the alternative channels all contribute to a common investor desire to find purposeful options to meet their objectives. It should be a marketer’s dream: money wanting to be placed and hungry managers actively seeking new investor partners. So why is the connection missing between the two? So Much Water Yet So ...
Columbia Law School hosted a revealing debate June 3 between prominent advocates of two sharply opposed schools of thought on monetary and fiscal policy. The debate pitted Robert Murphy, an avowed ‘Austrian,’ and Associated Scholar at the Ludwig von Mises Institute, against Warren Mosler, the central figure of a school of thought that calls itself “Modern Monetary Theory.” Murphy (pictured above) received a Ph.D. from New York University in 2003 with a dissertation on “Unanticipated Intertemporal Change ...
PrevInvest, in its May 2013 Investment Themes, provides a discussion of why long/short equity, also known as “equity hedged,” has experienced poor performance against market benchmarks over the last half decade. This is something of a flagship for the industry. It is the strategy that gave “hedge funds” their name, after all: it is the strategy of A.W. Jones! PrevInvest’s discussion of the numbers leads it into important related matters: the statistical relationship between fund size ...
Benoit Guilleminot and two colleagues have written a working paper on the impact of index flows on commodities prices, using U.S. traded (agricultural) commodities as their database. Along the way, they encourage thought about the nature of cause and effect in finance. There are many uses of terms such as “cause.” Sometimes, we use the word to refer to something that is happening at the same time as its effect. As the wind moves through the ...
