Browsing: Featured Post

Featured Post

Understanding the Surge in Appraisal Remedies

Apr 17th, 2018 | Filed under: Equity Hedge Funds, Hedge Fund Strategies, Hedge Funds, Newly Added

A new paper by Alexandros L. Seretakis takes a comparative look at appraisal rights in the United States and the European Union, noting along the way that this familiar legal protection mechanism for minority shareholders has become quite high-profile in recent years. Appraisal rights have given rise to “a newRead More


‘You Kick It’ and the Alternative Investment Industry

Apr 15th, 2018 | Filed under: Newly Added, Regulatory, Regulatory Environment, The A.I. Industry, UCITs

The Alternative Investment Management Association, the London-based organization representing the interests of the world’s alternative investment industry, has issued a new whitepaper about the impact of the exit of the United Kingdom from the European Union. This ongoing event, known popularly as Brexit, has occupied armies of reporters, planners, andRead More


Funds Use Public Info to Complement Private Signals

Apr 12th, 2018 | Filed under: CAPM / Alpha Theory, Equity Hedge Funds, Event-Driven Hedge Funds, Finance & Economics, Financial Economics Theory, Hedge Funds, Newly Added

Alan D. Crane and two colleagues have written a paper on whether and how hedge funds profit from publicly available information, in particular from SEC filings. Crane is an assistant professor at Houston’s Rice University, Jesse H. Jones Graduate School of Business. He and two Rice students, Kevin Crotty andRead More


Options-based Strategies and their Pay-offs

Apr 10th, 2018 | Filed under: Behavioral finance, Finance & Economics, Financial Economics Theory, Newly Added, Risk Management & Operations, Risk Metrics and Measurement

Roberto Obregon, of the Meketa Investment Group, has written a paper (available at SSRN) on the use of options-based equity strategies. Obregon is the author of a number of scholarly papers on alternative strategies, including one last fall on global macro, which he co-authored with Willam Dana. In his optionsRead More


Bitcoin Futures ETFs: SEC Requests Comment

Apr 8th, 2018 | Filed under: Currencies, Digital currencies, Emerging Alternative Investments, Finance & Economics, Financial Economics Theory, Newly Added, Other Topics in A.I., The Global Economy & Currencies

In December last year the NYSE Arca Inc. filed a proposed rule change that would allow for the creation of Exchange Traded Funds investing in Bitcoin futures contracts, and, potentially, in other related Financial Instruments. In January 2018 the U.S. Securities and Exchange Commission extended its review of this proposal.Read More


Be Fearful When Everyone is Greedy

Apr 5th, 2018 | Filed under: Allocating to A.I., Alternative Investments in Context, Institutional Asset Management, Newly Added, The A.I. Industry

A new report from Context Capital Partners looks into trends in the alternative investments industry, both among institutions and family offices. It finds continued strong demand for alt investments, as well as a rising demand within the alt world for such emerging strategies as cryptocurrency investments and environmental, social, andRead More


The Realities of Real Assets

Apr 3rd, 2018 | Filed under: Liquid and Fixed Income Real Estate, Newly Added, Real Assets, Real Estate, Real Estate Equity Investments

A London-headquartered specialist consultant, bFinance, has prepared a report on the trends that have emerged over the last decade in the way both investors and managers think about the real assets in portfolios. There are, the paper says, three trends at work. First, investors are becoming both more sophisticated andRead More


The VC and PE Markets in Canada

Apr 1st, 2018 | Filed under: Equity Types of Private Equity, Newly Added, Private Equity, Private Investments, Venture capital

The Canadian Venture Capital and Private Equity Association (CVCA) has posted what it calls an “overview” of the VC and PE Markets in that country in 2017. It reports growth in both of those markets, although growth at distinct velocities. The report tells us that, on the VC side, CanadaRead More


Finance Theory, Listed Equities, and Liquidity

Mar 29th, 2018 | Filed under: CAPM / Alpha Theory, Finance & Economics, Financial Economics Theory, Newly Added

A recent paper from Robeco discusses whether a liquidity premium exists in the stock market. The authors, David Blitz, Jean-Paul van Brakel, and Milan Vidojevic, conclude that “the evidence for such a premium is, at best, weak.” Less politely, these authors refer to the whole notion of a liquidity premiumRead More


THE ART OF IMPROVING INVESTOR RELATIONS

Mar 28th, 2018 | Filed under: Investor Relations, Newly Added, Sales & Marketing in the AI Industry

By Diane Harrison Merriam-Webster defines a debate as ‘a regulated discussion of a proposition between two matched sides.’ A good debate is not an argument. Rather, it is a thoughtful process of insightful positioning that allows two sides of a concept to be explored on their merits. Sound a bitRead More


The PE Lifecycle Can Be Audited by Blockchain

Mar 27th, 2018 | Filed under: Digital currencies, Emerging Alternative Investments, Newly Added, Other Issues in Private Investments, Other Topics in A.I., Private Investments

On March 19, Northern Trust announced that it has enhanced its blockchain technology for private equity to the point where it can be employed by auditors. The audit firm can have its own blockchain node, which will enable access to real-time fund data. Pete Cherecwich, who runs Corporate & InstitutionalRead More


Why Treasury Professionals are Building Cash Reserves

Mar 25th, 2018 | Filed under: Newly Added, Risk management, Risk Management & Operations, Risk Management Strategies & Processes, Risk Metrics and Measurement

The Association of Finance Professionals recently disclosed, via its Corporate Cash Indicators, that U.S. corporations accumulated more cash in the third quarter of 2017 than had been anticipated. This is consistent with other indications: corporations are concerned about the risks of the present environment and are working to ensure theyRead More


What Makes Big Data So … Big?

Mar 22nd, 2018 | Filed under: Algorithmic and high-frequency trading, Business News, Finance & Economics, Newly Added

The term “big data” has become a cliché. One has to remind one’s self that it is a somewhat ill-fitting label. What is new about the world of data isn’t that there is a lot of it; nor that on the software end the processing of data becomes easier overRead More


Central Europe as seen by private equity managers

Mar 20th, 2018 | Filed under: Newly Added, Private Equity, Private Investments

Deloitte has recently posted the results of its survey of how private equity managers see central Europe. A very concise summary of the findings of the survey is this: the PE industry expects that it will be buying CE assets in the coming months, and that it will be borrowingRead More


The Quants, the Algorithms, and the Performance

Mar 18th, 2018 | Filed under: Allocating to A.I., Alpha & Beta, Benchmarking & Performance Attribution, Hedge Funds, Newly Added

A new paper by J.B. Heaton, forthcoming in the Journal of Financial Transformation, offers a skeptical view of the algorithmic trading of securities, its actuality and its potential. Heaton is a lawyer (admitted to the bars of both Illinois and New York) and has a Ph.D. in finance, University ofRead More


Reducing Dependence on (L)IBOR

Mar 15th, 2018 | Filed under: Finance & Economics, Newly Added, Risk Management & Operations, Risk Metrics and Measurement, The Global Economy & Currencies

A creation of the mid-1980s, the London Interbank Offered rate (LIBOR) became immensely influential over the three decades that followed. It became a reference rate for both finance and commerce for the rate of nearly risk-free interest, and in the process it spawned other IBORs, including EURIBOR and Japan’s TIBOR.Read More


SCOTUS Decision Regarding Distressed Assets, Safe Harbors & Clawbacks

Mar 13th, 2018 | Filed under: Business News, Finance & Economics, Insolvency, Newly Added

The U.S. Supreme Court decision in Merit Management v. FTI Consulting may prove important to distressed asset managers, who need to know when defendants can assert the protection of the “safe harbor” provision of federal bankruptcy law, thus avoiding clawbacks. Section 546(e) of the statute says that a debtor mayRead More


Does Strong Economic Growth Equate to High Factor Returns?

Mar 12th, 2018 | Filed under: Newly Added, Other Topics in A.I.

By Nicolas Rabener, CAIA, Factor Research EQUITY FACTORS & REAL GDP GROWTH Summary: Economic cycles have a clear impact on factor performance Some factors show pro-cyclical while others highlight anti-cyclical characteristics Given that real GDP is not published in real-time, it is unlikely effective for factor selection INTRODUCTION Financial commentators frequentlyRead More


The Tipping Point for Alternative Data

Mar 11th, 2018 | Filed under: Industry Size & Managers, Investor Relations, Newly Added, Other Topics in A.I., Sales & Marketing in the AI Industry, The A.I. Industry

The Deloitte Center for Financial Services has put out a white paper on “Alternative data for investment decisions.” The term “alternative data” as Deloitte uses it refers to any set or sets of data that may be useful for investors but that is outside their traditional/conventional frame of reference.  InRead More


Preqin on the PE Outlook

Mar 8th, 2018 | Filed under: Equity Types of Private Equity, Newly Added, Private Equity, Private Investments, The A.I. Industry

Preqin has issued a report on the near term outlook for private equity based on a recent (November 2017) survey of more than 350 PE firms around the globe. Asked what is the biggest challenge facing them in the coming months, the most common response was: high company valuations. TheRead More


Robeco Researcher on Factor Premiums and ETFs

Mar 6th, 2018 | Filed under: Allocating to A.I., ETFs, Liquid Alternative Investiments, Newly Added, Other Topics in A.I., Smart Beta

David Blitz has recently discussed the concern in some quarters that factor premiums may disappear as they are arbitraged away by exchange-traded funds. Blitz, the head of quantitative equity research at Robeco Asset Management, says that such a concern is not justified, because “the exposures of ETFs that may beRead More


Whether Vol is High or Low, Gamma Trading Can Exploit Opportunity

Mar 5th, 2018 | Filed under: Hedge Fund Strategies, Hedge Funds, Newly Added

By Alternatives Team at Calamos Investments In 2018, volatility kicked into high gear. So far, there have been 11 days when the S&P 500 has moved at least 1%. Investors may not like the return of volatility, but it can strengthen the tailwinds for the gamma trading we do inRead More


Whence Corporate Social Responsibility?

Mar 4th, 2018 | Filed under: Due Diligence Process, Newly Added, Other Topics in A.I., Risk Management & Operations, Socially responsible investing, SRI and Clean Energy

A new scholarly paper, forthcoming in the Journal of Financial Economics, delves into the question whether institutional investors are the driving force behind corporate social economy. I.J. Alexander Dyck and three other scholars looked specifically at the environmental and social performance of firms across 41 countries. They found that ownershipRead More


Institutional Investors Wary of Passivity

Mar 1st, 2018 | Filed under: Allocating to A.I., Alpha & Beta, Institutional Asset Management, Newly Added, Other Topics in A.I., SRI and Clean Energy

Natixis’ Center for Investor Insight surveyed 500 institutional investors in the fall of 2017 about long-term objectives, short-term opportunities, and the concomitant pressures. In a new paper, Natixis discusses the Center’s take-a-ways from this survey Geopolitical events are the most worrisome prospect on the minds of the decision makers atRead More


News from AIMA: Performance and UK Regs

Feb 27th, 2018 | Filed under: Hedge Funds, Newly Added, Risk management, Risk Management & Operations, Risk Management Strategies & Processes, Risk Metrics and Measurement

New research by the Alternative Investment Management Association (AIMA), in collaboration with Preqin, indicates that hedge funds have produced “more consistent and steadier returns than equities or bonds over both the short term and the long term.” The study employed four scales of time: one year, three, five, and 10Read More


The Unrecognized Risks of Short Vol Strategies

Feb 25th, 2018 | Filed under: Finance & Economics, Financial Economics Theory, Newly Added, Risk Management & Operations, Risk Metrics and Measurement

Vineer Bhansali and Lawrence Harris have written a scholarly paper on what they call the “extraordinary growth of short volatility strategies” since late 2010. A lot of people and institutions seem to have come to the conclusion that spiking volatility is just that. A “spike” on a chart is definitionallyRead More


DB: Investors Newly Optimistic About Hedge Funds

Feb 22nd, 2018 | Filed under: Allocating to A.I., Asset allocation, Asset Allocation Models, Benchmarking & Performance Attribution, Fees, Hedge Fund Industry Trends, Hedge Funds, Industry Size & Managers, Institutional Asset Management, Institutional Investing, Newly Added, Performance, Analytics & Metrics, Structure of the Hedge Funds Industry, The A.I. Industry

Deustche Bank recently released its Alternative Investment Survey, the 16th annual.  This year the questionnaires received replies from 436 global hedge fund investors, with assets under management of $2.1 trillion, who shared their insights, sentiments, and allocation plans.  Glenn Bunn, co-head of Prime Finance at DB, said in a statementRead More


What Family Offices Want From Alternative Investment Managers

Feb 21st, 2018 | Filed under: Allocating to A.I., Family Offices, High-net-worth investors, Institutional Asset Management, Newly Added

By Diane Harrison Competition within the alternatives sector for family office investments is at an all-time high, as these investors get more comfortable with the range of assets available to them and their general understanding of alternatives rises. Fund managers want to win these wealthy investors over, but often findRead More


Eurekahedge: Greater China Mandates Pay Off for January

Feb 20th, 2018 | Filed under: Commodities, Commodities, Commodities: Examples, Digital currencies, Emerging Alternative Investments, Energy, Gold, Hedge Fund Industry Trends, Hedge Fund Strategies, Hedge Funds, Indexes, Investing in Commodities, Newly Added, oil, Other Topics in A.I., The A.I. Industry

A new Index Flash Update from Eurekahedge says that hedge funds are off to a positive start to 2018. The industry globally gained 2.26% in January. Among developed world mandates, North American hedge funds were up 1.89%, followed by those of Japan and Europe, which gained 1.28% each. Higher numbersRead More


PE Funds and the Causal Arrow

Feb 18th, 2018 | Filed under: Debt Types of Private Equity, Equity Types of Private Equity, Newly Added, Private Investments

A new report published by the Copenhagen Business School looks into the consequence of private equity investment on an industry-by-industry basis. The authors find that “industries where private equity funds invest grow more quickly [than others] in terms of total production and employment, and appear less exposed to aggregate shocks.”Read More


Urgent vs. Important: Barriers to Digitization in Alternative Investing

Feb 15th, 2018 | Filed under: Allocating to A.I., Alpha & Beta, Newly Added, Operations, Risk Management & Operations

KPMG International and CREATE-Research have jointly prepared a report about the digitization imperative for alternative investment management. The report includes within that term both hedge funds and private equity. Early on, its authors list eight key digital innovations that are reconstructing the industry: Application programming interfaces; cognitive technology and machineRead More


PE and VC Opportunities in 21st Century India

Feb 13th, 2018 | Filed under: Currencies, Equity Types of Private Equity, Finance & Economics, Newly Added, Private Equity, Private Investments, The Global Economy & Currencies, Venture capital

ARA Law, a firm based in Mumbai and Bangalore, India, has issued a paper on private equity and venture capital in that country. In a foreword, firm founder Rajesh N. Begur observes that there is a positive dynamic now at work in India’s economy, one that in his view “canRead More


Gold as a Strategic Asset

Feb 11th, 2018 | Filed under: Commodities, Commodities, Commodities: Examples, Gold, Investing in Commodities, Newly Added

The World Gold Council has recently posted its analysis of the continued relevance of gold. As one might expect from the source, the WGC finds that gold is a strategic asset that can play several valuable roles in a portfolio. Toward this end, the paper offers a chart of gold’sRead More


SSGA on Smart Beta

Feb 8th, 2018 | Filed under: Allocating to A.I., Alpha & Beta, Liquid Alternative Investiments, Liquid Alts, Newly Added, Other Topics in A.I., Smart Beta

State Street Global Advisers has put out a “Complete Guide to Smart Beta.” A preface by Lynn S. Blake explains that the focus of the paper is not on equity products but on “exciting new developments in the fixed income world.” Within that space, multi-factor strategies will proliferate going forward.Read More


S&P on Reading VIX

Feb 6th, 2018 | Filed under: Finance & Economics, Financial Economics Theory, Newly Added

S&P Dow Jones Indices has put out a paper offering market participants without patience for “academic rigor” an accessible guide to the so-called “Fear Index,” the VIX, calculated from the prices of a specific basket of S&P options. The contributors to the paper are: Tim Edwards, S&P Global senior director,Read More


Ceres Report Evaluates Value of Early-Stage Clean Energy

Feb 4th, 2018 | Filed under: Alternative energy, Commodities: Examples, Emerging Alternative Investments, Energy, Newly Added, Other Issues in Private Investments, Other Topics in A.I., Private Equity, Private Investments, Socially responsible investing, SRI and Clean Energy, Venture capital

A recent publication from Ceres, a nonprofit organization devoted to promoting sustainability as a goal in both investing and corporate governance, looks at the value that early-stage clean energy products offer venture capitalists. The publication is the work of a team of five “lead authors and key contributors,” including threeRead More


Unsophisticated Techniques of Equity Factor Investing Still Prevail

Feb 1st, 2018 | Filed under: Allocating to A.I., Alpha & Beta, Asset allocation, Asset Allocation Models, Institutional Asset Management, Institutional Investing, Newly Added

EDHEC Risk Institute, in collaboration with ERI Scientific Beta, surveyed 114 investment professionals between June and September 2017 about their motivation and interests with regard to equity factor strategies. It found that many, especially on the asset owners’ side of things, were strikingly distant from the state-of-the-art in analytical approachesRead More


Sovereign Wealth Funds, UN Goals, and Hedge Fund Fees

Jan 30th, 2018 | Filed under: Allocating to A.I., Fees, Hedge Funds, Institutional Asset Management, Institutional Investing, Newly Added, Structure of the Hedge Funds Industry

Dr. Rajiv Sharma has written an extensive literature review of “sovereign wealth funds’ investment in sustainable development sectors” for the UN sponsored high-level conference on Financing for Development. Sharma is research director, global projects center, at Stanford University. He writes in this review that there are “a number of issuesRead More


Muster Drill: To the Value Lifeboats

Jan 30th, 2018 | Filed under: Finance & Economics, Newly Added

By Scott Opsal While we’re not calling for an imminent market top, we are keeping a diligent watch from the crow’s nest for signs of a coming market correction. Equity investors worried that there is a bear-shaped iceberg looming somewhere in 2018 should be evaluating defensive portfolio strategies that wouldRead More


The Rationality (or Otherwise) of Public Pension Fund Managers

Jan 28th, 2018 | Filed under: Allocating to A.I., Institutional Asset Management, Institutional Investing, Newly Added, The A.I. Industry

A new research paper from the Stanford University Graduate School of Business discusses the rationality (or otherwise) of the return expectations of institutional investors, with especial reference to public pension funds. It finds that the returns that pension fund managers expect from their investments are extrapolated from the returns thoseRead More


What CTAs Think about Bitcoin Futures

Jan 25th, 2018 | Filed under: Commodities, CTA, Currencies, Digital currencies, Emerging Alternative Investments, Finance & Economics, Macro and Managed Futures Funds, Newly Added, Other Topics in A.I., The Global Economy & Currencies

A new BarclayHedge study indicates that the majority of commodity trading advisers surveyed are unenthusiastic about the new Bitcoin futures. Specifically, asked “do you consider Bitcoin futures to be a valuable/useful addition to a diversified futures portfolio?” nearly three quarters (73%) said “no.” The sample for this survey included firmsRead More


KPMG’s Report Cards on Real Assets

Jan 23rd, 2018 | Filed under: Infrastructure, Institutional Asset Management, Institutional Investing, Liquid and Fixed Income Real Estate, Natural Resources and Land, Newly Added, Operationally Intensive Real Assets, Real Assets, Real Estate, Real Estate Equity Investments

KPMG has posted a new paper looking at the role of real assets (defined as “anything where there is a tangible/physical asset being traded”) within a portfolio, with a focus on opportunities for U.K. based institutional investors, especially pension schemes. It begins with a brief survey of the field. RealRead More


Firms of the Near Future: Process and Product Innovators

Jan 21st, 2018 | Filed under: Alternative Investments in Context, Newly Added, The A.I. Industry

Last summer the Boston Consulting Group put out a report on the global asset management industry, called “The Innovator’s Advantage.” The title was an allusion to a landmark 1997 book by Clayton Christensen, The Innovator’s Dilemma, which in turn was a forceful restatement of some old Schumpeterian ideas about theRead More


Aquila Asks: Who’s Afraid of Pricey Markets?

Jan 18th, 2018 | Filed under: Commodities, Commodities: Examples, Finance & Economics, Gold, Newly Added, The Global Economy & Currencies

A new paper from Aquila Capital Group looks at managed futures, and makes the case that they offer investments tools with which one can achieve a “robust and diversifying risk/return profile.” The paper begins with the concerns many investors have at present. Record long bull markets, high asset prices, andRead More


CRYPTOCURRENCIES – HOT BUY OR HOT AIR?

Jan 17th, 2018 | Filed under: Currencies, Digital currencies, Emerging Alternative Investments, Newly Added, Other Topics in A.I., The Global Economy & Currencies

By Diane Harrison With traditional stock markets offering robust gains in 2017 and looking poised to continue their attractiveness in 2018, investors need strong persuasion to shift their equity allocations elsewhere. Enter the latest media darling: cryptocurrencies. The alternatives news feeds are awash in stories extolling the meteoric rise ofRead More


Stockholder Inspection Rights Survive Challenge in Delaware

Jan 16th, 2018 | Filed under: Equity Types of Private Equity, Newly Added, Private Equity, Private Investments, Regulatory Environment, The A.I. Industry

On December 29, 2017, the last business day of the expiring year, the Delaware Chancery Court, in a memorandum of opinion by Vice Chancellor Slights, upheld stockholders’ statutory books-and-records inspection rights against a defendant corporation that sought to invoke and considerably to widen the scope of the Delaware Supreme Court’sRead More


FACTOR INVESTING: GROSS TO NET RETURNS

Jan 15th, 2018 | Filed under: Fees, Hedge Fund Industry Trends, Hedge Funds, Newly Added, The A.I. Industry

By Nicolas Rabener, FactorResearch From Theory to Reality Summary: Long-short multi-factor portfolios generate attractive returns before fees Post fees charged historically returns are much less attractive However, some fees in the long-short space are likely justified given higher complexity INTRODUCTION Reality is the murder of a beautiful theory by aRead More


Searching for the Right Infrastructure Manager: 3 Case Studies

Jan 14th, 2018 | Filed under: Allocating to A.I., Infrastructure, Institutional Asset Management, Institutional Investing, Newly Added, Operationally Intensive Real Assets, Real Assets

A new paper from bfinance (an independent financial services consultancy headquartered in London) discusses the “dramatically different era” into which infrastructure investing has entered over the last two years. The paper, “DNA of a Manager Search: Infrastructure,” looks at three recent unlisted infrastructure searches, in order to glean some insightRead More


Principles, ESG, and Credit Risk

Jan 11th, 2018 | Filed under: Newly Added, Other Issues in Private Investments, Other Topics in A.I., Socially responsible investing, SRI and Clean Energy

The UN Principles for Responsible Investment (PRI), an initiative working to put into practice six principles on the environmental, social, and governance (ESG) aspects of investment decisions, in partnership with the UNEP Finance Initiative and the UN Global Compact, has issued a paper on the credit ratings agencies and theirRead More


A Proposal for a Monthly Art Market Index

Jan 9th, 2018 | Filed under: Emerging Alternative Investments, Newly Added, Other Topics in A.I., Real Assets

It has long been understood that ownership of works of art isn’t just a collection or a hobby, or a way to brighten up the walls of one’s home. It’s a portfolio decision. But it is a portfolio decision that involves non-fungible and very infrequently traded assets.  So: how doesRead More