Risk Management
Howard Marks’s approach to risk emphasizes the importance of understanding risk as the probability of loss, not volatility, and managing it through careful judgment and strategic thinking.
Big data-driven AI in financial services is a technology that augments human capabilities. We are living in countries governed by the rule of law, and only humans can adopt safeguards, make decisions, and take responsibility for the results.
Risk managers must look at market and model risk through a single lens to see the complete picture of their market-related investment and trading risks, as well as management costs, complexities, time, and regulatory requirements.
Here's a weighting scheme to mitigate economic risks while preserving the benefits of diversified multi-factor strategies.
No matter how sophisticated and expensive a firm's AI tools are, it should not forget that the principle “garbage in, garbage out” (GIGO) applies to the entire investment management process.
Despite some current limitations, AI stands to offer significant advantages versus traditional approaches to identifying and predicting financial crises.
Once known as secure and profitable investments, utilities are now viewed as enterprises fraught with financial risks. Investors should favor utilities that employ AI and other digital strategies to minimize damage from natural disasters.
How can investors assess climate transition risk in their portfolios?
The yield curve is inverted, implying an imminent recession, but the stock market is at or near record highs. What can we make of these contradictory signals?
Start-up valuations have yet to fully reflect the market's ongoing downdraft. The correction could prove as protracted as that of the dot-com crash.