Practical analysis for investment professionals

Joachim Klement, CFA

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35 Posts

Biography

Joachim Klement, CFA, is a trustee of the CFA Institute Research Foundation and offers regular commentary at Klement on Investing. Previously, he was CIO at Wellershoff & Partners Ltd., and before that, head of the UBS Wealth Management Strategic Research team and head of equity strategy for UBS Wealth Management. Klement studied mathematics and physics at the Swiss Federal Institute of Technology (ETH), Zurich, Switzerland, and Madrid, Spain, and graduated with a master’s degree in mathematics. In addition, he holds a master’s degree in economics and finance.

Author's Posts
Dumb Alpha: Accelerating Momentum

Momentum investing can seem like an insult to your intelligence. Why should prices go up just because they have gone up in the past? But there is plenty of evidence that momentum investing works in the medium term.

Dumb Alpha: The Drawbacks of Compound Interest

With short-term forecasts, random walks tend to outperform the accumulated wisdom of professional forecasters. That estimation uncertainty is not reduced for long-term forecasts either, because mean reversion cannot overcome the effects of compound interest. Luckily, there is a range of techniques, from simple to sophisticated, that can help long-term investors with this challenge.

Dumb Alpha: Are Your Forecasts Better Than a Random Walk?

Research confirms a “wisdom of the crowds” effect insofar as only a few analysts seem able to consistently outperform the consensus forecast compiled from many different analysts.

Dumb Alpha: The Ignoramus’s Guide to Asset Allocation

Modern finance constantly busies itself with the development of new, more sophisticated ways to manage risk and generate returns. These efforts, however, generate their own risks. On the opposite end of the spectrum are simple ways to invest that have a proven track record of providing superior investment outcomes.



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