Author: Anu Heda

Best Blogs of the Week #224

Posted by Anu Heda on Mar 28, 2016, in Best Blogs of the Week , tagged with , ,

Three posts from different blogs this week covering emerging markets, pension plans and Valeant.

Lord Abbett – The Growth Investor: Lessons from the Valeant Struggle – The takeaway for growth investors is clear: the high-growth universe is full of big winners and big pretenders.

Russell – The pension plan herd has broken up – For me, the most striking feature is the divergence between the investment approaches. Once upon a time, pension plans paid a lot of attention to peer group comparisons.

Wells Fargo – Five reasons emerging markets assets have rebounded– Overall, we assess the developments in China as slightly positive for emerging markets near term. (Helpful chart re: Brazil below)

 

Source: Wells Fargo Advantage Voice

 

Best Blogs of the Week #223

Posted by Anu Heda on Mar 21, 2016, in Best Blogs of the Week , tagged with , ,

This week’s blogs include numerous posts related to negative interest rate policy. None were particularly insightful so we steered towards three compelling posts on varied topics.

BlackRock – Why millennial women are tuning into their finances –  We also found that millennial women who learned financial responsibility from their parents were more likely to engage in and enjoy investing.

Columbia – Is the U.S. heading towards a recession? – For now, we can say the U.S. economy is late cycle, with recession risks rising but not yet elevated.

M & G – The Central American Remittance Crunch – who would lose most from a Trump Presidency? – The US election campaign has surprised everyone thus far. [Enough said.]

blog posts

Best Blogs of the Week #222

Posted by Anu Heda on Mar 14, 2016, in Best Blogs of the Week , tagged with , ,

Three blog posts this week including big data, intergenerational wealth transfer, and high yield. All three are critically important for financial advisors today and thus important for the companies serving them.

AB – Tuning Out the White Noise in High Yield – This isn’t 2008 all over again. The recent sell-off looks a lot more like what the market endured in 2002.

BlackRock – What Big Data Can Tell us about the Economy– Rather than relying on a few anecdotal bits of evidence, big data allows us to measure exactly how much more frequently words like “recession” have crept back into use.

Putnam – Making inroads with the next generation – The biggest obstacle to retaining assets passed to heirs is a lack of relationship.

(Image from aforementioned BlackRock blog post)

Straying from a Standard Can Be Dangerous

Posted by Anu Heda on Mar 03, 2016, in Thoughts , tagged with ,

Our clients know we dig deep to unearth findings and recommendations worth pursuing. Sometimes that leads us to cataloging fact sheet data points across asset classes and boundaries (curious to the most frequent MPT stat in Belgium? Ask Mike!) In regulatory materials, there’s not much deviation from the status quo. Occasionally you find something slightly unusual and pause. We’re advocates of the Eaton Vance Fund-Approach-Features start to each fact sheet (like in this Small-Cap Fund). A qualitative description is a good place to deviate and try something compelling.

What is a bad place to deviate? Any $10,000 investment graph. Imagine our shock when seeing the above chart included in a fact sheet.

timothy10yr

What’s your first question when looking at this?

If you’re like me, you’re wondering how come this chart begins at $22,500 (roughly)?

Well to understand why, you need to read the endnotes (located on page 2) describing the chart as showing growth of 10K from inception (Class A – 1994). You would need a chart starting in March 1994 to show the growth of 10K into $45,088.

I can’t find an industry leader that shows a chart like this on a retail mutual fund. The aforementioned Eaton Vance chart shows the standard practice of starting at 10K, 10 (or 5) years ago.

Vanguard and BlackRock exemplify the standard Web practice with different time durations but always beginning at a standard $10/$100K.

Though most likely compliant, this chart feels dishonest in its departure from industry standard practices.