The Ivy Portfolio: How to invest Like the Top Endowments and Avoid Bear Markets is written by Mebane Faber in 2009. In 2007 he wrote the white paper called “A Quantitative Approach to Tactical Asset Allocation”. On the website SSRN Top 10 this paper is clearly number 1 and it has been requested over 175,000 times.
The paper “A Quantitative Approach to Tactical Asset Allocation” is a Tactical Asset Allocation model. However, the book The Ivy Portfolio is an analyses of strategic asset allocation. It discusses the battle between the universities Yale and Harvard. In what way do they differ in investing and allocations.
The book begins with an analyses of these two universities and comes with a few possibilities how to replicate the fantastic results – in other words: ‘shadowing the Super Endowments”. This results in a lot of pages showing data and data-analyses. However, this is necessary to understand him explaining about replicating these portfolios.
The strategy of the white paper “A Quantitative Approach to Tactical Asset Allocation” is discussed in the book as well. It is used to discuss the topic Alternatives. The characteristics of Private Equity and Hedge funds are important to scrutinize. By using the motto “Winning by not Losing” the active strategy of the most downloaded white paper is shown in a very clear way.
What becomes very clear from this book is that statistic allocations is not desirably. Active management or rotating between different asset classes is the solution. With the book The Ivy Portfolio you could also say: Following the Smart Money!
OpinioPro vs The Ivy Portfolio
Due to Brexit being official now, a lot of investments will feel the need to make modifications. This is possible when based on a model. Knowing statistics while investing to gain profit is the right course of action. However, there will often be a discussion in an investing committee. The arguments that will support the investment case can be found on the research platform of OpinioPro.
OpinioPro is a platform for professional investors with visions from the perspective of supports and of opponents.
New research can be found on the platform of OpinioPro on a daily basis. However, you can also search an asset manager’s vision he had in the past. It will not be a surprise that at the moment the amount of published research on Brexit and asset allocation implications on www.opiniopro.com is enormous.
OpinioPro has currently over 3,000 investment research reports on these subjects on its platform. The best ‘research engine’ is now available without registration on www.opiniopro.com.
The Black Swan: The High Impact of the Highly Improbable was published in 2007, so it is a pre-crisis book. However, the writer Nicholas Taleb is still able to captivate the reader nowadays and this makes it a timeless book. Taleb has become a distinct criticaster of the financial world where he started himself as a trader. At the start of his career he was active in both equity and bond derivatives and later he became a market maker. He included in his bestseller The Black Swan both his positive and his negative experiences and sometimes he takes in the book a philosophical direction.
The book is about unpredictable events that have a huge impact. Before the crisis in 2008, the rise of the “quantitative investor” in the financial world was big and it seemed like you could make a model for everything. When you have data you can make a quantitative model and you can start as an investor. However, there are unpredictable elements that cannot be included in a model.
During quantitative investing you can of course explain drawdowns afterwards and that is the insight Taleb wants to give you with his book. He gives an insight how these Black Swans can have a positive effect as well.
OpinioPro vs The Black Swan
This book makes you think about the fact how much time you spend on predictions, certainly with investing. A good philosophy or strategy is to bear in mind you can come across unexpected issues. This is a good addition to the investing policy. Knowing what experts are thinking belongs to the financial world and having a different vision is not automatically a negative thing. It might be a realistic vision we do not want to see. OpinioPro is a platform for professional investors to find many visions on a topic that is at issue in their organization in a fast way. Visions of both supporters and of opponents!
On OpinioPro’s platform, you can find new research on a daily basis. However, you can also search an asset manager’s vision he had in the past. At the moment Brexit, asset allocation and factor investments are hot topics on www.opiniopro.com.
OpinioPro has currently over 2,500 investment research reports on these subjects at its platform. The best ‘research engine’ is now available without registration on www.opiniopro.com.
Besides the usual outlooks, Brexit perils and central bank policy this week also treatises on income inequality, regulatory changes and the question of questions; does the market goes up or….?
In their monthly publication or outlook “Economic and Strategy Viewpoint” Schroders is introducing two new scenario’s. “Trade wars” and “Brexit shakes the EU”. Both are introduced to reflect the increase in political risk in the world economy. The former is based on the election of Donald Trump as president of the US. In terms of their impact on global activity, both new scenarios are ultimately seen as stagflationary.
In “Headwinds weaken but risks remain” ABN Amro argues that in 2016, the contribution of emerging markets to global economic growth will increase slightly for the first time in years. But off course there is no upside without a downside; the risk of setbacks remains as high as ever.
Source is the master of the catchy title, who can beat “A Marxist view of the S&P 500”? But apart from the title they often raise an interesting question. Last week they took a look at Rising income inequality. Is that a good or bad thing for the owners of capital? For a different view on this subject we recommend the Netflix doc “Requiem for the American Dream”.
AXA has been a steady contributor to the BREXIT discussion. According to them the “The economic impact of Brexit on the EU” is likely to be less than 0,5% of GDP. The bigger question in their view is therefore the implication of Brexit for the future of the EU from a political and institutional perspective.
In “shifting insurance company allocations: implications for high yield”, J.P. Morgan takes a look at the likely consequences of proposed changes to regulatory capital requirements for U.S. life insurance companies as well as U.S. GAAP accounting changes for insurance companies that file U.S. GAAP. They expect a potential increase in structural demand for high yield bonds. Which will have implications for their asset allocation views.
“Does China have too much debt?”. Does it? It ranks only in the middle of the world debt league with countries such as Japan, Belgium, Portugal, Ireland, the Netherlands and Greece recording significantly higher debt ratios. BNP Paribas explains.