Month: April 2014

The Amazon “Money Market”

By far the most difficult part of any asset manager’s job is protecting clients from themselves. This is not to say that the management of assets and risk is easy; far from it. But managing client behavior and mitigating behavioral biases is a far more formidable task because you cannot remove emotion from the equation. […]

Each year, thousands of new undergraduate and MBA students are indoctrinated with the virtues of the almighty Efficient Market Hypothesis (EMH). Despite an abundance of evidence disproving the central tenets of the theory, the orthodoxy remains in place. In the academic world, the desire to explain market movements in one convenient theory seems to trump […]

One of the most misused and destructive phrases in the investment world is the notion of a “stock picker’s market.” Depending on the market environment, it is used in different ways, but all generally incorrect. In a relentless uptrending market, investors become highly confident in their ability to pick stocks, naturally calling it a “stock […]

2014: The Inverse of 2013

“For the loser now will be later to win, For the times they are a-changin’” – Bob Dylan At the beginning of this year (click here and here), we cautioned investors against abandoning all asset allocation and risk management principles in chasing the unusual 2013 performance in US equities. It is no secret that many […]

Yesterday, we learned of a new report released by the International Monetary Policy (IMF) warning that a shock in Emerging Markets could “rattle” developed economies. This is merely the latest in a steady stream of news reports over the past few months with similar warnings. As I have been writing about since February, though, the […]