My latest draft article submitted for publication in IFA can be found here. In an nutshell, one of the problems with asset allocation portfolio construction in recent years is the increase in the number of asset classes promising diversification benefits…hasn’t quite turned out that way. Secondly, we’ve seen equity-like risk creeping into the fixed interest …
Category Archive: Uncategorized
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Feb 01
A Simple Portfolio Analysis of the Future Fund
On Friday the Future Fund published its asset allocation as at 31 December 2009. Before we jump to any conclusions about its make-up its important to understand what the investment objectives are… CPI plus 4.5% to 5.5%pa over a rolling ten year period with an acceptance of short term underperformance whilst the Strategic Asset Allocation …
pub-5731955080761916
Feb 01
RBA Rate Rise tomorrow? Odds on
Australian Government Bond Yields – 29 Jan 2010 Source: Bloomberg The RBA Cash rate is currently at 3.75% and with government backed 30 day bank bills at 4.12% and the recent tender of 23 March 2010 Treasury Notes fetching a yield of ~3.96% the financial markets are pretty much expecting a 25bps increase. Whilst the sharemarkets have had the …
pub-5731955080761916
Feb 01
Jon Stewart talks Obama vs Bankers
The Daily Show With Jon Stewart Mon – Thurs 11p / 10c Obama Takes On Bankers www.thedailyshow.com Daily ShowFull Episodes Political Humor Health Care Crisis Send article as PDF
Jan 24
S&P500 vs Inflation vs PE Ratio over 97 years
The above chart shows the 10 year performance of the S&P500 (blue bars) versus the 10 year average annual inflation (red bars) versus the Shiller PE Ratio at the start of each decade (green bars). There are several notable observations… The worst performance was during the 1930s when the US experienced a deflationary environment and …
Jan 23
The return of lifetime annuities!??!
I just read that the Henry Review is likely to suggest that superannuation can be exchanged for guaranteed lifetime income like lifetime annuities. Strangely, it can be done already by purchasing a lifetime annuity with superannuation money. The problem with the current situation is that there are no lifetime annuities left on the market….Comminsure and …
Jan 22
Interest Rates…relatively stable but a minor dip at the long end
Source: Reserve Bank of Australia The government bond yield curve certainly expects another 50bps in RBA hikes this year with bonds yielding in the second half of this year trading around 4.3% to 4.4%. But since the start of the year the yields in longer term bonds have declined a little…this indicates a slight drop in …
Jan 20
Active managers smash passive managers in 2009
Yesterday Morningstar released their investment performance league tables for each of the major asset classes for the Australian market. For almost every asset class in 2009, a higher proportion of active manager outperformed the index funds, like Vanguard, than underperformed. Vanguard’s 1 year performance rankings for each asset class are… Australian Shares – 55th out of 99 International …
Jan 15
John Stewart on Wall Street Bonuses
I found this video one of my favourite blogs….www.calculatedrisk.com . “The only people who have recovered from the financial meltdown are the ones who caused the financial meltdown”…John Stewart Click here. Send article as PDF
Jan 12
Economist Magazine says Australian housing overvalued by 50%!!!
I started reading this week’s Economist mag yesterday and the lead article is about the asset bubbles that are appearing all around the world thanks to low interest rates. Article can be found here for subscribers. In terms of housing the article suggested that the US is at fair value, whilst Britain is 30% overvalued, …