Since 2009, US equities have outperformed every major asset class by a considerable margin, returning 14.5% a year on average. And, over the same period, a simple 70% US equity/30% bond portfolio* returned 11.4% per year, on average. These kinds of results can tempt even the savviest investors into abandoning their long-term discipline and chasing […]
June 2017
The IRS’s somewhat unexpected decision to delay implementation of the RP-2014 mortality tables has impacted at least three separate aspects of pension plan strategy: calculating minimum contribution requirements; determining variable-rate PBGC premiums; and valuing lump-sum distributions to be paid out to terminated vested participants. This brief discusses what has changed and provides general considerations for all sponsors to weigh in the near term.
May 2017
Answers to our clients’ questions about market action and the market environment in a few paragraphs every two weeks. Investments with the potential to earn returns competitive with equities—without a dependence on economic growth—are especially valuable diversifiers for portfolios. Such investments are varied, sometimes niche, and require skilled implementation. Many require some illiquidity, but may […]
May 2017
Answers to our clients’ questions about market action and the market environment in a few paragraphs every two weeks. Although the election results provide a powerful “risk-on” catalyst in the short term, the underlying long-term problems facing France and the Eurozone are unlikely to go away under a Macron presidency, so the old adage “sell […]
April 2017
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
Answers to our clients’ questions about market action and the market environment in a few paragraphs every two weeks. 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, […]
March 2017