There are many successful value investors that have made a name (and a fortune) for themselves exploiting irrationality in the stock market by identifying dislocations between prices and true long-term value. A new ETF seeks to isolate and capture this "value premium" systematically.
What does it mean to have a truly diversified portfolio? True diversification is more about the correlation of assets, or how they move in relation to each other, than it is about the sheer number of holdings in a portfolio.
Babe Ruth was the most accomplished hitter in baseball history, not because he was the most consistent but because he produced more bases per hit than anyone else. Likewise, sometimes the risk/reward profile is even more important than consistency when analyzing an investment strategy.
In 1952 Harry Markowitz pioneered a portfolio management theory that set in motion a broad shift in portfolio construction methodology. Fast forward to today and you have a slew of investors that are questioning the merits of the market’s efficiency given the violent ups and downs of the past decade.
A common concern among investors today is the prospect of runaway inflation. The knee jerk asset that many flock to for this purpose is the Treasury Inflation Protected Security (TIPS). It’s a common misconception that the primary role of TIPS is as an inflation hedge, which reflects a lack of understanding of the intricacies of how TIPS actually work.
In John Mauldin’s “upside down world” capital markets are no longer driven by finance and economics – they are driven by public policy. This is the world we’ve lived in for nearly four years now, and current price action in the market continues to bear this out.
The most often quoted metric of stock market volatility is the VIX Index. We explore a new ETP which is designed to tread water during periods of relative calm in the markets and partially participate in big upward spikes in the VIX when markets sell-off, which is the definition of an antifragile investment.
For centuries gold has been considered a store of value. Its portability and permanency gave rise to our modern day understanding of using currency in exchange for goods and services. We see three major fundamental tailwinds working in gold’s favor right now.
We have been in a policy-driven market now for roughly four years. Both monetary and fiscal authorities have played a heavy-handed role in the economy and capital markets over this time period. Global central bank (monetary) policy is on our Macro Radar due to its post-financial crisis impact on investor sentiment and the performance of both stocks and commodities.
It is hard to answer this question in the scope of broad classifications such as institutional and non-institutional/"retail" investors. The biggest differentiator comes down to whose money is being invested.
Nassim Taleb defines antifragility as something that thrives from random and unexpected shocks. At Season Investments we search far and wide for assets that have the potential to exhibit antifragile characteristics. One such investment that we hold in the Absolute Return asset class is the 361 Managed Futures Strategy Fund.
Unlike a stock or a bond, a commodity is not a producing asset, but rather it is a hard asset. Therefore, the fundamental value of a commodity can't be calculated the same way as a producing asset. We rely on our Inflation Adjusted Commodity Index (IACI) to ascertain this value.