The Attributes of a Successful Investment Program

Success starts with having a long-term focus and not being unduly distracted by short-term events. This is because over the long-term there is a clear equity risk premium and a long-term investor has a decided advantage due to the ability to capitalize on liquidity premiums and market dislocations... Read More

Why You Need to Care about Plan Governance

Retirement plan governance doesn’t elicit the same glamour as other facets of managing investments, but its importance is difficult to ignore—particularly in light of recent debacles where poor oversight, negligence and, in some cases, outright fraud have resulted in costly outcomes. These events don’t have to happen: a thoughtful approach to governance will create better results... Read More

Negative Interest Rate Policy - Sound Monetary Policy or Grasping at Straws?

The move in January by the Bank of Japan to lower their bank rate to -0.1% comes on the heels of similar initiatives by European central banks. There are currently five central banks — Japan, the ECB, Denmark, Sweden and Switzerland that have lowered their deposit rate into negative territory. A negative interest rate policy may be counterintuitive but there are a growing number of central banks that are considering... Read More

Decoding Investment Consultant Alpha

T he job we do as trustees is one of the hardest I can think of. I say we, because I have served as trustee on several pension and endowment funds. Successful committees have to know something about the capital markets (at least enough to be afraid of them); they have to be able to assess investment managers, which is an art in itself; and they have to have good internal dynamics, balancing diversity of backgrounds... Read More

A Dichotomy Of Strategies

The post-financial crisis period has not been kind to trustees and their investment committees. Difficult financial markets have increased pressure to improve performance and reduce risk – a difficult task at the best of times. How does an organization make gains in the face of historically low interest rates and stubbornly high liabilities? Pension plans, endowments, and foundations all have varying degrees of financial... Read More

Surviving Success

T he job we do as trustees is one of the hardest I can think of. I say we, because I have served as trustee on several pension and endowment funds. Successful committees have to know something about the capital markets (at least enough to be afraid of them); they have to be able to assess investment managers, which is an art in itself; and they have to have good internal dynamics, balancing diversity of... Read More

Past No Predictor Of Future

Past superior performance does not persist into the future is the finding of Rogers Casey research of investment manager performance for the past decade. While the study observed some anomalies, the results generally confirmed its long-held view. Specifically, there is a lack of persistence within most equity peer groups and persistence within the core fixed income universe... Read More

Risk is Not The Same as Volatility

By Michael Keppler | If you ask investors what risk they assume when buying stocks, they likely will respond, “Losing money.” Modern portfolio theorists do not, however, define risk as a likelihood of loss, but as volatility, which is determined using statistical measures of variance such as standard deviation and beta... Read More