Beyond the Public Markets: Evaluating the Role of Private Credit
Private credit has been gaining traction among investors looking to broaden their portfolios beyond traditional stocks and bonds. Once reserved for institutional investors and ultra-high-net-worth individuals, this asset class is now more accessible to a broader audience, thanks to evolving fund structures and emerging investment platforms. But what is private credit, and how does it […]
Derivatives Explained: How Smart Risk Management Shapes Everyday Business
Derivatives sound like Wall Street jargon, but they’re really just simple agreements that help businesses and investors manage uncertainty. At their core, a derivative is a promise: two parties agree today on terms to buy or sell something at a set price on a future date. This lets companies lock in costs or revenues now, […]
Hedge Funds Demystified: What Retirees Need to Know
Most investors first hear the term “hedge fund” and picture a secretive club where only the ultra-wealthy can play. In reality, they’re simply private funds that give managers much wider latitude than a traditional mutual fund. They can borrow, sell securities short, trade derivatives, and concentrate positions in ways a traditional mutual fund cannot. The […]
What is Risk?
Risk is one of those complicated concepts that you can’t really pin down to one definition, but it’s the single most important factor for investors.
Why Can’t ‘Winning’ Active Managers Keep on Winning?
The numbers show that active management simply doesn’t work. There are several arguments against active fund managers, but one of the most damning is that winners don’t seem to repeat.
Are Republicans or Democrats Better for the Stock Market?
Every four years we talk about how this year’s Presidential election is the most important ever. Along the way, people make a whole host of sweeping statements about how picking their team will lead to all of the good things happening, but picking the other team will lead to all of the bad things happening […]
What Is Style Drift and Can It Be Avoided?
All too often, the funds you use end up sabotaging your asset allocation. What if the funds you select don’t do what you think they will? When you use actively managed funds, you have to watch out for something called “style drift” – when a fund’s style (what the fund actually owns) moves over time.
How Often Should I Rebalance My Portfolio?
The market is going to drag your portfolio through every mud puddle it finds. It’s your job to pick your portfolio up, dust it off, and point it back in the right direction. Rebalancing brings your portfolio back into line, and ensures that you are taking the right amount of risk through time.
How Long is the Long Term?
Everyone always talks about investing (and planning) for the long term. But they’re usually vague about what the “long term” actually means. Does that mean 5 years? 10 years? More? (Spoiler: the answer is definitely more). And frankly, talking about how you need to focus on the long term can feel like a bit of […]
Reverse Engineering To Desired Retirement Time Horizons
This article is part of a series; click here to read Part 1. Using the portfolio return and volatility assumptions determined in Exhibit 1.1, we then reverse engineer fixed return assumptions and sustainable spending levels for a desired retirement time horizon and targeted probability of success. The investment portfolio is modeled using 100,000 Monte Carlo […]
