Despite numerous studies attempting to link volatility to changing fundamentals, research shows that investor emotions are the root cause of the vast majority of these price changes, according to C. Thomas Howard. Read more
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Jason Voss, CFA, is a content director at CFA Institute, where he focuses on fixed income, behavioral finance, corporate finance, and quantitative methods. He is the author of The Intuitive Investor, and he also ran a successful blog titled What My Intuition Tells Me Now. Previously, he was a portfolio manager at Davis Selected Advisers, L.P., where he built an impressive track record co-managing the Davis Appreciation and Income Fund. Mr. Voss earned a BA in economics and an MBA in finance and accounting from the University of Colorado. Topical Expertise: Behavioral Finance · Corporate Finance · Fixed Income
Interest rates in the US have started to rise over the past month, surprising many in the investment world. We asked readers earlier this week: Have interest rates in the US finally started their upward climb toward normalcy? For many of the 918 respondents (approximately 42%), the answer is “Yes, recent increases are in response to important changes in the interest-rate landscape.” Read more
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As modern portfolio theory fades in reputation from intense pressure from behavioral finance, many researchers are seeking to fill the void with behavioral finance applications. Behavioral portfolio management is one such model. Read more
8 CommentsAmong the more remarkable comebacks in financial history is the recent resuscitation of the global asset-backed securities market that was pronounced dead after the 2007–09 global financial crisis. Earlier this week, we asked readers whether they thought the revival was a positive or negative development for financial markets. Read more
2 CommentsThere is no such thing as a future fact. Facts by definition are things that occurred in the past, but investing unfolds in the future. So what a skilled futurist thinks about the future is potentially investable information. Earlier this year I discussed the major themes of David Houle‘s new book, as well as tools analysts can use to better discount the future. In this portion of my talk with Houle he discusses: a possible fix for global warming; his view of how the dominating theme for humanity in the 21st century; and whether economics or government will be the most important source of power. Read more
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Lim Chow Kiat, CFA, group chief investment officer of the Government of Singapore Investment Corporation, tackled one of the most vexing questions in the investment world today: how to invest in a low-yield world. Read more
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It used to be that investors most feared interest rate risk in industrial countries and credit risk in emerging economies. The rules have changed, says Ramin Toloui, PIMCO’s global co-head of emerging markets portfolio management. Read more
Leave a CommentOften financial analysts are presented with statistical charts that purport to demonstrate an important — and, of course, investable — relationship between data points. These charts are supposed to be worth a thousand words and thousands of shares traded. But invariably these charts do not have an r-squared for the data displayed, or any other descriptive statistical data; just the seductive image. Read more
28 CommentsKent Osband offers that the mathematics of turbulence provides a mathematical framework for bridging modern portfolio theory’s rationalism with behavioral finance’s irrationalism. Read more
4 CommentsJason Trennert of Strategas offers his sometimes contrarian outlook for equity markets while sharing insights on the European currency crisis and the prospects for inflation. Read more
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