Adaptive and sophisticated strategies are necessary to serve the unique features, constraints, and needs of multiemployer plans. In this note, we explore some of the key challenges that many multiemployer plans face, discuss how to invest in light of these challenges, and provide thoughts on governance and the overall role of the investment advisor in the multiemployer context.
April 2017
An extended bull market can tempt even the savviest investors into abandoning their long-term discipline. Resisting the impulse to switch horses in the middle of the race is hard, but necessary—the most important trait of successful investors is their ability to maintain discipline in sticking to a long-term strategy during good times and bad. Diversified portfolios—structured to earn returns comparable to their rate of spending at tolerable levels of risk—have benefitted long-term investors and grown their purchasing power for decades, and we have no reason to expect a different outcome when today’s bull market inevitably corrects.
April 2017
This quarter’s edition discusses the reflationary environment, positioning in global equities, prospects for sovereign bonds (both nominal and inflation-linked), and USD strength. We also profile two strategies that can diversify portfolios without dependence on economic growth: life settlements and pharmaceutical royalties.
April 2017
We doubt it. But, price levels are likely to rise gradually in the months ahead, as the rebound in energy commodities continues to impact measurements. Recent inflation data releases have raised concerns about a potential spike, with headlines warning that the consumer price index (CPI) posted its largest monthly gain in four years. Concerns appear […]
March 2017
Some of the reflation trades that received a boost from the US election (such as the stronger US dollar and higher US bond yields) look to be merely taking a breather as investors square positions; however, the fundamental support for others—particularly the outperformance of US small-cap equities—is challenged. The US election was not the only […]
February 2017
Simple is not so sweet in the current environment. In a world of global uncertainty, investors should place a premium on diversification. The siren song of the simple portfolio may be difficult to resist, but its appeal is based on recent performance that is unlikely to be repeated over the next decade. Prospective long-term returns […]
January 2017
In our 2017 outlook, we review the prospects for several asset classes—developed and emerging markets equities, credit, real assets, sovereign bonds, and currencies—and share the advice of our chief investment strategist.
December 2016
When endowment funds slip “underwater” (below the historic dollar value of the original gift), institutions face a tradeoff between distributing anticipated budget support and restoring the endowment to its original value. Ultimately, the choice of underwater policy depends on the situation and needs of each institution in balancing endowment preservation with program support.
August 2016