Sun, Apr 30, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Diversification research introduces new explosive index

Tuesday, June 19, 2012

Beverly Chandler, Opalesque London: New research from Ineichen Research and Management AG examines diversity and introduces the Financial Explosivity Index. In a lengthy report entitled Diversification? What diversification?, Alexander Ineichen quotes everyone from Einstein to Oscar Wilde to Woody Allen and finds that the idea of diversification is very old and is essential to survival of wealth, life, and everything.

Diversification in terms of investment is a useful selling point, Ineichen says. "The institutional pioneers invested in the 1990s; early adaptors around 2000-2002; and then the institutionalisation of the hedge fund industry took off. The institutionalisation of hedge funds took place during a time where nearly any diversified portfolio of hedge funds had outperformed equities or a 60/40 equity/bond mix on a rolling five year basis. The main selling points were "absolute returns," or "alpha," or the hedge-funds-can-make-money-in-all-market-conditions argument. Diversification was an important additional selling point; it always is. Whether it is emerging market bonds, CDOs, wind parks, etc. the diversification argument is most certainly to enter the sales pitch".

Ineichen writes that the "buy low and sell high" adage is arguably overused and easily ridiculed. "The "buy low and sell high" adage is essentially the colloquial five word summary of value investing" ......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: Ex-Man manager combines sustainable investing with AI/ML[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Dr. Richard Bateson, quant fund manager and physicist, has recently

  2. Gondor Capital sees challenges ahead for financial markets as two hedge funds post strong gains in Q1[more]

    Komfie Manalo, Opalesque Asia: Vincent Au, portfolio manager of New York-based hedge fund firm Gondor Capital Management believes that the remaining of the year would be challenging for the financial markets even as his two hedge funds maintain

  3. Service Providers - Colemore launches fee tracking service for limited partners[more]

    Following Colmore's successful launch in January 2017, the firm has announced the launch of FAIR.. FAIR is designed to help private equity investors independently validate fees and incentives charged by underlying managers, saving time and providing an extra level of comfort. There is a glob

  4. Regulatory - 'Fist bumps' at hedge funds over Trump's tax plan[more]

    From Reuters.com: U.S. hedge fund managers began warming to President Donald Trump soon after his surprise election ignited a powerful stock market rally. Now, his dramatic tax cut plans give them even more reasons to cheer. Trump, looking to make good on pledges for sweeping tax reform, on Wednesda

  5. Investing - Some of the world's biggest hedge funds think private equity stocks are cheap, International stock funds attract $1.8 billion post-French election, ValueAct unveils interest in KKR as firm shows earnings beat[more]

    Some of the world's biggest hedge funds think private equity stocks are cheap From Forbes.com: As institutional investors pile into new mega-sized private equity funds, allowing firms like Apollo, Blackstone, Carlyle and KKR to raise record amounts of cash, much of this gush of money has