Why Setting an Asset Allocation Policy Is a Bad Idea
- Is Buy and Hold Dead? Exploring the Costs of Tactical Reallocation. Blanchett, David M. // Journal of Financial Planning;Feb2011, Vol. 24 Issue 2, p54
There are important costs" an adviser should consider when implementing a tactical asset allocation strategy for a client. The research conducted for this paper suggests that in order to achieve similar risk-adjusted performance as a static portfolio with the same equity allocation, one must be...
- MULTI-MANAGER VIEW. Smith, Ian // Money Marketing;7/14/2005, p20
Presents the author's view on the use of multi-manager funds. Assertion that multi-manager is a means by which independent financial advisors reduce their compliance risk; Statement that multi-manager offering takes away the asset allocation decision; Reference to the investment process as one...
- Risking Your Money Again? Quinn, Jane Bryant; Ehrenfeld, Temma // Newsweek;11/10/2003, Vol. 142 Issue 19, p43
Encourages individual investors to develop a personal investment policy. Determination of personal goals; Choice of appropriate investment depending on the timing of needs; Emphasis on diversification and discipline; Availability of financial planning advice.
- Allocation allocation allocation. // Money Marketing;11/25/2004, p48
Advises how independent financial advisers (IFAs) make appropriate asset allocation decisions. Adoption of portfolio construction tools; Approach that allows IFAs to invest according to their clients' attitude to risk and time to retirement; Question of what of adviser do IFAs really want to be.
- MPT Was Never Alive. Swisher, Pete // Journal of Financial Planning;Jun2009 Trends in Investing, p16
The article presents the author's views on the use of the modern portfolio theory (MPT). MPT was said to have been created for global market equilibrium, as opposed to be an asset allocation tool. In investing, equity, debt and real estate, and derivatives are considered for financial planning,...
- INVESTING: 8 mistakes you may be making. Brentnall, Vicki // Medical Economics;3/4/2005, Vol. 82 Issue 5, p45
Discusses the common mistakes in making investments. Lack of investment strategy; Need to be aware of all the investment risks; Advantages of diversifying investments; Importance of understanding the tax consequences of each investment decision.
- Stock Return Predictability and Asset Pricing Models. Avramov, Doron // Review of Financial Studies;Fall2004, Vol. 17 Issue 3, p699
This article develops an asset allocation framework that incorporates prior beliefs about the extent of stock return predictability explained by asset pricing models. We find that when prior beliefs allow even minor deviations from pricing model implications, the resulting asset allocations...
- Comparative Analysis: An Alternative Investment Model for a Structurally Changing Market Environment. // Journal of Financial Planning;Jun2006, Vol. 19 Issue 6, p60
The article advises financial planners on investment models for structurally changing market environments. Financial advisors should avoid investments in companies with top-down business structures, as these are not guaranteed to remain profitable in the era of globalization. An alternative...
- Parting Thoughts. // Journal of Financial Planning;Oct2006, Vol. 19 Issue 10, p40
The article presents the author's thoughts on false assumptions related to asset allocation, the determinants of portfolio performance, and the determinants of financial success. The dangers of financial planners being lured into thinking that asset allocation policy plays an important role are:...