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The ESG Conundrum: Environmental, Social and Governance Factors for the Fixed Income Investor
  The Benefits of ESG Integration in Fixed Income Social Costs Looking at the World Through ESG-Colored Glasses Stakeholders with Different Needs   Implementing the use of Environmental, Social and Governance (ESG) factors into the investment process presents different challenges for fixed income and equity investors. Many ESG ratings providers are centered on the concerns of equity investors. Fixed income
Go West, Young Investor…But Go Wisely: Intelligent Investing in an Unintelligent Landscape
“Go West, young man” was advice popularized in the late 1800s by the American author and newspaper editor Horace Greeley in regards to America’s Westward Expansion.1 Greeley “saw the fertile farmland of the west as an ideal place for people willing to work hard for the opportunity to succeed.”2 Potential success, measured in terms of productive land to farm, luxurious
Investing During a Different Rate Cycle
Amid a rise in market volatility around the world, the fundamentals for Asia equities look fairly healthy. Investors should not ignore, however, the interconnectedness of today’s global markets. The correlation between different asset classes has risen a fair amount, due in part to a distortion from the low-rate environment. Now we are about to enter into a different interest rate
Passive Investing May Not Work for Fixed Income. But What Does?
In the fixed income market, I think passive investing actually poses a tremendous risk. There has been a shift from active to passive investing across asset markets. So over the last year we've seen over $70 billion move into passive strategies that track the Bloomberg Barclays U.S. Aggregate Index. I think it's important for investors to understand what that index
3 Reasons Your Retirement Is One Big Math Problem
Retirees concerned about running out of money often fret about how inflation can ruin their plans. While that’s understandable, it’s also possible that their worries are misdirected. [REITs] See 2017 Hedge Fund Letters. RitaE / Pixabay“The No. 1 disaster that hurts people in retirement is not inflation,” says Brian Decker, a financial planner and founder of Decker Retirement Planning Inc.
ESG: Improving Your Risk-Adjusted Returns in Emerging Markets
Introduction The demand for environmental, social, and governance (ESG) or responsible investing (RI) is growing at a rapid pace with nearly USD 23 trillion of assets being professionally managed under RI as of 2016, an increase of 72% since 2012.1 Despite increased investor interest and relatively higher risk exposure to ESG issues, the lack of breadth and depth in corporate
What the MSRB’s Markup Disclosure Rule Means for Muni Investors and Advisors
The Municipal Securities Rulemaking Board (MSRB)’s new “markup disclosure rule” is on track to go into effect in the U.S. in May 2018, as part of a broader move toward greater transparency in the municipal bond market. Approved by the Securities and Exchange Commission (SEC) last year, the MSRB rule will require municipal bond brokers to provide retail customers with
Why Active Management Failed…and Didn’t
Passive equity strategies have seen massive inflows over the last decade, in part owing to active management’s struggles. But a closer look at the story within the story suggests that leaving active out of the equation could be leaving money on the table. First, a little history on how we got here. In the early 1980s, the baby boomer generation
Harvard Business Review: Financial Statements Don’t Work Anymore
Several weeks ago three professors from the Columbia and Dartmouth business schools recapped some of their work on accounting for intangible investment in a Harvard Business Review article. Their key finding, which builds on Professor Baruch Lev’s analysis in The End of Accounting, is that, “accounting earnings are practically irrelevant for digital companies”. Along with Professor Lev, Professors Govindarajan, Rajgopal and Srivastava found
Reverse-Think Your Portfolio to Target Success in 2018
In April of 2009, days from the bottom of the 2nd worst stock decline in the past 100 years, we wrote in this commentary that it was “a good time to invest in stocks due to their bargain prices.” The commentary went on to argue the case that stocks were poised to rally strongly ahead. I got a call from