Practical analysis for investment professionals

W. Bradford McMillan, CFA, CAIA

5 Posts

Biography

Brad McMillan, CFA, is the chief investment officer at Commonwealth Financial Network, a private independent broker/dealer, where he also leads the retirement consulting division. McMillan holds the CAIA, MAI, and AIF professional certifications. He holds a BA from Dartmouth College, an MS in real estate development from MIT, and a BS in finance from Boston College.

Author's Posts
Why Investment Managers Are the Good Guys

Despite lots of criticism of the investment industry, one investment manager writes on why he is proud to do his job.

A Modest Proposal: Why Doesn’t the Fed Forgive the Debt?

W. Bradford McMillan, CFA, discusses an idea for a solution to the debt ceiling crisis.

Unknown Unknowns in Investing

When I was asked, “What do you believe but can’t prove in investing?” the Donald Rumsfeld quote about knowns, known unknowns, and unknown unknowns came to mind. Where in that context do unprovable beliefs fit? My first thought is that they’re known unknowns. If we have an unprovable belief, then we have a strong opinion that could be wrong, which would seem to place us squarely in the known unknowns.

Investment vs. Speculation: Using the Minsky Criteria

Hyman Minsky has become famous in the aftermath of the financial crisis for his characterization of the three phases of markets – hedge finance, where the borrower can repay interest and principal out of cash flows; speculative finance, where cash flows can repay interest but not principal, and therefore need to roll over any financing; and Ponzi finance, where cash flows cannot pay either principal or interest and therefore must either borrow more or sell assets to support those costs.



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