Short-termism is a major alpha wound that hurts the performance of active investment managers. Short-termism leads to higher trading costs, makes it harder to properly evaluate the management of businesses, imposes time constraints that prevent investment strategies from reaching full flower, and increases bias. New research demonstrates this pressure is coming from clients rather than from investment managers themselves. Read moreLeave a Comment
An internet-driven information revolution defined the economic boom of the late 1990s, and financial engineering coupled with housing prices led to the booms and busts of the 2000s. Will the current cycle be about China or real transformative technological innovations that can have a lasting and beneficial influence on both markets and economic vitality in general? Read more1 Comment
Janet Zhang shares two key insights from the 10th Asian Bond Markets Summit in Beijing: There is still ample room for China’s bond market to develop but China’s corporate bonds are quite different from those in the developed markets, so foreign investors should understand their subtleties before investing. Read moreLeave a Comment
Edward Altman recently spoke with Larry Cao, CFA, in Hong Hong about the Altman Z-score, its original inspiration, evolution, use and misuse, as well as the current credit situation around the world. In this first installment, Altman discusses how the Z-score model was developed and how its latest iterations have built on that initial foundation. Read more2 Comments
Infrastructure is seen as an attractive proposition, not only because of its (in some sectors) double-digit returns in a low-yield environment but also because it offers diversification opportunities coupled with reliable earnings and consistent cash flows. Infrastructure can also be used for liability matching and inflation hedging (given that inflation tends to be built into the revenue stream of projects).