Practical analysis for investment professionals

Active Equity Renaissance

The Active Equity Renaissance is a series of posts by AthenaInvest Founder and CIO C. Thomas Howard, PhD, and Jason A. Voss, CFA, retired co-portfolio manager of the Davis Appreciation and Income Fund. It proposes an alternative to modern portfolio theory (MPT), pokes holes in MPT’s underlying assumptions, and discusses ways to improve active management returns.

The Active Equity Renaissance, A Case Study: Alpine Capital Research

Active equity managers can outperform their benchmarks, especially if they follow some important guidelines. Alpine Capital Research (ACR) and its CIO, Nicholas Tompras, CFA, provide a case study on how to implement these factors.

The Active Equity Renaissance: Renaissance Investment Management Firms

The primary focus of the renaissance investment management firm is delivering the best possible investment performance, not on scaling for scaling’s sake, C. Thomas Howard and Jason Voss, CFA, explain in the latest entry in The Active Equity Renaissance series.

The Active Equity Renaissance: Renaissance Portfolio Management

Dismantling the finance industry’s closet indexing factory is a critical step in The Active Equity Renaissance, C. Thomas Howard and Jason Voss, CFA, observe.

The Active Equity Renaissance: Behavioral Financial Markets

Jason Voss, CFA, and C. Thomas Howard have questioned many orthodoxies of modern portfolio theory (MPT). But what do they propose to take their place? Behavioral finance.

The Active Equity Renaissance: New Frontiers of Risk

One modern portfolio theory (MPT) pillar that is unquestionably broken is the use of volatility, specifically standard deviation, as a measure of risk, Jason Voss, CFA, and C. Thomas Howard write in the latest edition of The Active Equity Renaissance series. This initial error in MPT's development is a major contributor to active investment management underperformance.

The Active Equity Renaissance: The Rise and Fall of MPT

After the dust settles, virtually nothing of modern portfolio theory (MPT) will remain, asserts C. Thomas Howard and Jason Voss, CFA. The three pillars on which MPT rests have been toppled, and it is time to move on. There is an alternative way to view securities markets, their movements, and their participants: behavioral finance.

The Active Equity Renaissance: Understanding the Cult of Emotion

“I know you are afraid and you should be afraid. I will invest you in products that will not stir up your fears." This sentiment is applied over and over again in the investment industry in one form or another, by the "Cult of Emotion."

The Active Equity Renaissance: Rejecting a Broken 1970s Model

Collectively, active equity delivers no value to its investors and, in fact, extracts value from them. So what can be done to launch an active equity renaissance?

By continuing to use the site, you agree to the use of cookies. more information

The cookie settings on this website are set to "allow cookies" to give you the best browsing experience possible. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this.