Displaying items by tag: investors

Wednesday, 16 August 2023 04:34

Risk not your mojo?

Save the risky business for the movies.

With little risk linked to it, active fixed income is one reason investors are attracted to it, according to assetnvesting.net.

What’s the scoop here? Well, it guarantees the capital of investors and reduces --  and not just a little – the insecurity that it can dispense in the event that if, for one thing, an equity investment’s opted for.

It doesn’t stop there. Additionally, the fixed income shells out a return. While it might not be robust when weighed against other investments, it boasts a reputation ahead of time. That matters since, because of it, investors are positioned to previously know the results it will secure. For conservative investors, it’s what they opt for first.

And talk about versatility. Tactical responses to a cocktail of market climates and shifts in regimes are facilitated by an active approach, according to troweprice.com. On top of that, it dishes out the flexibility to leverage pricing anomalies and dislocations that a volatile climate might generate. Additionally, curve positioning could be a good idea to mull.

Category: Eq: Market, 

Keywords: active, investors... etc.

Published in Eq: Total Market
Wednesday, 16 August 2023 04:16

Relativity speaking

You’ve heard of the theory of relativity. Just a hunch, of course. How about model portfolio theory? And how does it work?

Well, it abets the ability of investors to tamp down on market risk and wring the most out of return, according to forbes.com.

On one hand, investors can erect optimized portfolios with modern portfolio theory, on the other, however, are there limitations? Yep. 

For example, estimates – all of them – stem from historical data that might have nothing to do with current or markets down the road.

The “perfect investment” can be a tough nut to crack.

That said, modern portfolio theory’s been highly popular, according to Investopedia.com.

It’s contended by modern portfolio theory that, possibly, an ideal portfolio that hands investors maximum returns by tacking the optimal amount of risk, can be designed.

When it comes to diversifying securities and asset classes – on top of the benefits of stopping short of putting your eggs in the old basket -- MPT’s a big supporter. 

Published in Eq: Total Market
Thursday, 27 July 2023 03:36

Fixed income coming up aces

What scent are they picking up on? The lay out: they want to leverage climbing interest rates, which are tugging the total in MMFs past $5tn. That said, many members of that pack were ready to segue into fixed income – when investors felt gob smack sure that yields would sidestep taking a hit by additional action on the Fed’s part, said Blackrock, according to ft.com.

“There is finally income to be earned in the fixed income market and we are expecting a resurgence in demand,” said Rob Kapito, president.* “There are trillions . . . that are ready, when people feel rates have peaked, to flood the market and we need to position ourselves to capture that.”

Like a boxer holding his own despite absorbing more than his share of a pummeling, while the U.S. economy continues to hold tough, when it comes to core fixed income, the macro outlook’s looking up, according to sageadvisory.com.

Over the upcoming quarters, a cocktail of appealing yield carry and escalating returns rates skews returns north.

Published in Eq: Total Market
Monday, 17 July 2023 20:26

Direct indexing holds the cards

Talk about that feeling of being left out. You know; as in hit the road, Jack.

With direct indexing, investors can include – or turn their backs on -- specific stocks from an index, according to etftrends.com. Not only that, entire sectors can be similarly left out. Yep, not exactly star treatment.

What’s more, leveraging guidance from an advisor, investors can do a gaggle of things; let’s say, for example, align their portfolios with their values and sustainability objectives. 

Sure, it dispenses tax loss harvesting opportunities. But there’s more. With direct indexing services like Vanguard Personalized Indexing, advisors can build customized portfolios. That accommodates their client’s individual investment goals.

While, in recent years, one of the ready for prime time features, direct indexing not only boasts positives, but downsides as well, according to comparebrokers.co.

In the financial industry it’s tabbed as the foreseeable future, optimal for investors who are big believers in customizing the portfolio. For those who’ve retired, it’s the rage.

Published in Eq: Financials
Sunday, 02 July 2023 18:46

Assessing the Impact of ESG Investing

In an article for Quartz, Nate DiCamillo assesses whether ESG funds are having a positive impact. In theory, ESG investing will compel companies to act more responsibly by accounting for environmental, social, and governmental principles when making decisions.

Critics contend that ESG funds are merely a means for asset managers to collect fees given the murky nature of ESG factor scoring. It also creates an incentive for companies to ‘greenwash’ certain behaviors simply to get higher ESG scores. 

Others are also dismissive of ESG, because it attempts to combine disparate issues into a single product that have little relation to each other. Additionally, there is little evidence that ESG results in better outcomes, yet companies spend more resources to align with these principles to please ESG-focused investors. 

What’s interesting is that the trend may have peaked. In the first quarter of the year, inflows into ESG funds were down by $163 billion compared to last year. In part, it’s due to the partisan backlash against the trend as many conservatives are pushing legislation to ensure that state funds are barred from investing in ESG funds or using ESG to make investment decisions. 

Finsum: ESG investing has become the center of intense controversy. Yet, it remains unclear whether it’s actually effective in terms of reaching its goals. 


Published in Wealth Management
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