More on Related Themes
2011-06-28 Smart Risk Taking: Realigning Client Portfolios with Their Long-Term Goals by American Century Investments (Article)
The financial crisis sparked widespread flight from risk. Although the crisis is over and equity prices have rebounded, many investors have not yet returned to the capital markets. For them, the safe-haven appeal of money market funds remains strong. In this paper, American Century Investments® proposes a strategy of "smart risk taking," an active asset management approach that seeks to identify, understand, manage, and be consistently rewarded for risk.
2011-04-19 Blinded by the Light (of Data) by Mariko Gordon (Article)
When analyzing data, 'seeing the light' can take time and patience. But as with viewing art, it's time well spent in getting to the heart of the matter. In response to a reader question, let's examine the concept of standard deviation and how it can mislead those who rush to a conclusion.
2010-09-14 The $100 Million Nightmare by Mark Matson (Article)
About 20 years ago, the financial advisory industry began a mass exodus to what it believed was a promised land. Thousands of advisors from coast to coast switched from commissions to fee-based planning, aiming to gain $100 million of assets under management. In this guest contribution, Mark Matson discusses what went wrong with that transition, and how advisors can deal with the problems it created.
2010-02-16 How to Squander $170 Billion by Robert Huebscher (Article)
Some of the managers supposed to be among the sharpest have cost their clients $170 billion dollars over the last two decades. These are "plan sponsors" who handle pension funds, endowments, and foundations, and Scott Stewart, a former money manager who now teaches finance at Boston University, has documented their value destruction in a recently published study.
2010-02-16 The $100,000 Challenge to Passive Managers by Roger J. Schreiner (Article)
In this guest contribution, money manager Roger Schreiner challenges passive management advocates. He will wager $100,000 that, through active management, can outperform any passive buy-and-hold portfolio net of fees.
2009-11-10 Investment Viewpoints - September 2009: Four Reasons to Emphasize Active Investment Management by Enrique Chang and Scott Wittman (Article)
Since the onset of the global financial crisis, there has been an increasing number of articles in financial journals and the financial press pointing out that actively managed investments of all types did not fare well relative to passive investment strategies. In this article, American Century Investments provides four fundamental reasons why those who have forecast the demise of active investment management are mistaken, in part due to one of the most common errors of behavioral finance-the Recency Effect. We thank them for their sponsorship.
2009-11-03 More on the Fama-French Farewell Tour by Various (Article)
Tom Howard responds to two letters to the Editor in last week's issue, which follow-up our article on the latest Fama-French study defending passive management. Howard says there is plenty of academic evidence of "plain old stock-picking skill."
2009-06-16 Peter L. Bernstein Remembered by Robert Huebscher (Article)
The investment industry lost one of its leaders last week, when Peter L. Bernstein passed away at the age of 90. As an author, Bernstein provided clarity and insight to our understanding of risk and the way markets operate, through his books and his newsletter, Economics and Portfolio Strategy. We are republishing our interview with him last January, when he foresaw many of the elements of the current crisis.
2009-05-05 Letters to the Editor by Various (Article)
We touched a few nerves last week with our critique of Standard and Poor's SPIVA study, where we raised doubts about S&P's claim that passive management does better in bull markets than in bear markets. We publish letters from two of our more vocal critics, along with our response.
2009-03-24 Lessons from Madoff by Adam Jared Apt (Article)
Bernard Madoff has yet to share with the public the benefit of everything that he learned in his years of running what was likely the world's greatest Ponzi scheme ever. Perhaps he'll reveal all now that he had pleaded guilty, though that is by no means a legal requirement and he seems unlikely to do so. Nonetheless, we are already able to draw a number of lessons from this one disastrous episode in the endless history of financial scandals, says advisor Adam Apt in this guest contribution.
