Hallmarks of Successful Active Equity Managers

As a Firm we are proponents of combining Active & Passive managers to optimize the risk-adjusted returns. Our business is building unique, core, strategic, passive models that provide market returns or beta at a low cost. While there are many reports written about why active management does not make sense as it adds minimal value, I came across this report which talks about why and how active managers might...

British Pound vs. US Dollar

  The British Pound is back at fresh four-year highs against the US dollar, which could be a negative development as far as the Bank of England (BoE) is concerned. GDP is trending higher (very slowly) but CPI growth is slowing rapidly, possibly signaling that the deflationary environment in the Eurozone is spilling over the English Channel. Less than three years ago, CPI was puzzling the BoE as it...

Dividend Investing

The era of ZIRP, easy money and financial repression has forced many savers/retirees to look elsewhere for yield/income. This has forced many investors to look at dividend paying stocks to capture a more predictable source of income and as a hedge against market gyrations. With the “graying” of America, it is not surprising that increasingly more investors have been chasing income-generating assets amid this period of relative low interest...

iBillionaire Index

An ETF linked to the iBillionaire Index is in the process of being launched. The iBillionaire Index (BILLION) is designed to track and measure the performance those who have, over time, reaped the biggest rewards on Wall Street: financial billionaires. The index monitors the portfolios of leading billionaire investors, such as Warren Buffett, Carl Icahn, Daniel Loeb, David Tepper and David Einhorn.You can check out the Index below: iBillionaire...

CRB Commodity Index

  After three years of negative sentiment and capital outflows, commodities appear to be coming back.  The Financial Times published an article yesterday highlighting the turning sentiment in commodities after $50bn of net redemptions in 2013. Some analysts are speculating that the renewed interest in commodities is related to their uncorrelated returns, making them popular as a portfolio diversifier. However, more than anything commodities are becoming attractive because prices...

Retirement Remains Americans’ Top Financial Worry

Is this a surprise? As per a recent Gallup survey, a majority of Americans, 59%, are worried about not having enough money for retirement, surpassing eight other financial matters. A majority of Americans have reported being “very” or “moderately” worried about retirement savings every year since 2001, illustrating that saving for retirement disquiets Americans in both good and bad economic times. Retirement Remains Americans’ Top Financial Worry

Best Practices in 401(k) and 403(b) plan design

A leading-edge 401(k) or 403(b) plan should consider the following plan design features: Immediate eligibility to make employee deferral contributions with a one-year wait period to receive employer matching contributions; Automatic enrollment at an employee deferral contribution rate of between 3% and 6% and automatic employee deferral escalation of 1% each year up to a maximum 10% deferral rate; A stretched matching contribution to encourage higher employee deferrals (e.g.; 25% of...

What investment options should be offered for 401(k) and 403(b) plans?

When building an investment option lineup for a 401(K) or 403(b) plan, what is an optimal choice to have from a best practices point of view? Per our recommendation, it should broadly follow the selection process below: Offering 10 to 16 core funds which cover broad asset class exposures like U.S. Equities (Large, Mid and Small Cap), International Equities (Large and Small Cap), Emerging Market Equities (Large and Small...

Chinese Yuan 12 month Forward

  Official data released on Tuesday showed China’s foreign exchange reserves jumping by $129 billion in the first quarter, to an all-time high of $3.95 trillion. The Chinese build reserves by intervening to weaken the Yuan against the US dollar. US Treasury officials responded by verbally reprimanding the Chinese about free market forces, although they stopped short of labeling the country a currency manipulator. It appears as though the...

Employers Ramping Up Retirement Plan Features, Advisory Services

Employers are enhancing their retirement plans and increasing access to professional investment advice in an attempt to bolster employee retirement readiness. A new study by Aon Hewitt, which polled more than 400 plan sponsors serving 10 million plan participants, revealed a number of initiatives being taken to strengthen employee ability to achieve greater financial security in retirement. Key actions include the following: Boosting employer matching funds: The percentage of...