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Welcome to Asset AllocationFounded in 1997, we provide independent analysis and insight each month on asset class valuation, portfolio construction and risk management to a global audience of investment managers, financial advisers and sophisticated individual investors. We help our subscribers to limit their downside risk, build better portfolios, keep up with new products and research, and make better investment decisions in the face of uncertainty. Our research is based on the application of complex adaptive systems theory (also known as the adaptive markets approach). We believe that financial markets are filled with positive feedback loops and nonlinear effects caused by the interaction of competing strategies (for example, value, momentum, and passive approaches) and underlying decisions made by people with imperfect information and limited cognitive capacities who are often pressed for time, affected by emotions, and subject to the influence of other people. As a result, while attracted to equilibrium, they never reach it, and can sometimes generate substantial over and undervaluations. Under these conditions, mean variance optimization is likely to produce disappointing portfolio results. Given this, we take an innovative approach to portfolio construction that is based on multiple regimes (high uncertainty, high inflation, and normal growth), stochastic optimization (to assess shortfall risk and goal achievement under a wide range of scenarios) and evolutionary search (for integrated asset allocation and rebalancing strategy solutions that are robust in the face of uncertainty). We provide model portfolios in eight currencies, including AUD, CAD, CHF, EUR, GBP, INR, JPY and USD. They are based on a combination of broad asset class index funds and uncorrelated alpha strategies. The former include real return (inflation protected) bonds, nominal bonds, foreign bonds, domestic and foreign commercial property (real estate), commodities, timber, and domestic, foreign, and emerging market equities. We also add new asset classes to our model portfolios as they become investable. For example, in 2009 we will add equity volatility. Our model portfolios also include explicit rebalancing strategies. A second implication of our adaptive markets perspective is that when overvaluations reach dangerous levels, we believe that relatively passive approaches to risk management (such as diversification and automatic rebalancing) must be supplemented with more active approaches, like increasing allocation to liquid assets and buying put options. To enable our subscribers to make these decisions, each month we provide them with fundamental valuation and momentum updates for asset classes in all the currency regions we cover, as well as updated economic scenarios that assess potential asset class valuation and systemic risk changes over a longer time horizon. Our monthly research also includes feature articles on new products, strategies, and analytical methodologies. At a time of unprecedented uncertainty in the world economy and financial markets, the analysis and insight we provide each month is more important than ever. For example, in March 2000 and again in May 2007, we advised our subscribers to hedge or reduce their exposure to dangerously overvalued asset classes. The quality of our research has been recognized around the world. As Barron's has noted, "If you're looking for loads of editorial content on asset allocation, check out IndexInvestor.com...The content is thorough, and the investing rationale carefully explained." In the U.K., Money Management magazine said "IndexInvestor.com keeps us up to date both with the latest thinking on risk, and the surest way of reducing it to a level that we find satisfactory." Our research is provided via two publications. The Index Investor is published on a monthly basis. Each issue contains year-to-date returns for multiple asset classes and uncorrelated alpha strategies, a review of current asset class valuations, an economic update with implications for future asset class returns and allocations, year-to-date results for our model portfolios, a review of new products and strategies, letters to the editor and one or more feature articles. A subscription to The Index Investor also includes access to all our back issues (list of topics is available), as well as collections of articles on different investing topics to facilitate education and self-study. Subscribe today and start getting the knowledge and insights you need to make better asset allocation and risk management decisions. We started Retired Investor because the challenges facing these investors are actually more complex than those facing investors who are still in the accumulation stage of their financial lives. In Retired Investor, we focus on key questions such as, "Will we outlive our savings?" "Will we have enough money to cover long term care or other unexpected expenses?" "Will we be able to leave something to others?" We help investors and their advisers answer these questions on the basis of evidence, logic and good analysis. In addition to asset class valuation, strategic and tactical asset allocation, risk budgeting, rebalancing and the appropriate use of active (uncorrelated alpha) and passive strategies, in Retired Investor we also address important issues surrounding the use of annuities. Retired Investor is published ten times per year. Each issue contains year-to-date returns for multiple asset classes and uncorrelated alpha strategies, a review of current asset class valuations, an economic update with implications for asset allocation, year-to-date results for our model portfolios, a review of new products and strategies, letters to the editor and one or more feature articles. A subscription to Retired Investor also includes access to all our back issues (a list of topics is available), as well as collections of articles on different investing topics to facilitate education and self-study. Subscribe today and start getting the knowledge and insights you need to make better asset allocation and risk management decisions.
You can always reach us at questions@indexinvestor.com |
What People Say About Us
Prudence requires that [you] invest widely and wisely... www.indexinvestor.com gives invaluable advice to investors on asset allocation." Financial Advisor Magazine, UK "The Index Investor ... is well worth the money for investors wanting an ongoing education on index funds." Barron's "The question of what is the right asset allocation... and which are the low cost index funds suitable for such a policy...is answered by www.indexinvestor.com, a brilliant and almost free web-site." Money Management (A Financial Times publication) "If you're looking for loads of editorial content on asset allocation, check out IndexInvestor.com... The site's content is thorough, and its investing rationale is explained carefully." Barron's Our writing on asset allocation has also been featured in the Wealth Management Report, produced by the Wharton School and the Institute for Private Investors. "OK, now I'm seriously impressed! All of the great information you have on your web site and newsletters and a personal response to a question. It's a great value." New Subscriber "I enjoy your website and read your monthly editions. I find it very useful for my personal portfolio and for advising our clients." Subscriber "Your site is the best unbiased investment education resource I have found on the internet. Your well-organized collection of past articles is a better investments course than anything I got in two years of MBA school. Keep up the good work" Subscriber
Would your group like to learn more about asset allocation or the indexing versus active management debate? We provide entertaining and informative public speakers at a very reasonable cost. Recent presentations have included the Spring 2004 World Series of ETFs and a Fall 2004 European Private Banking Conference on asset allocation, active management, and hedge funds. Click here to request more information.
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