Thu, Jul 2, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Ineichen Research & Management introduces risk management research

Wednesday, October 05, 2011
Opalesque Industry Update - Economic variables are falling and risk measures are rising. This is a time to be cautious or hedged rather than courageous and unhedged.

Ineichen Research & Management Ltd. (“IR&M”) has just launched a new research product line with a particular focus on risk management. The risk management research is designed to help investors make better risk management decisions in times of heightened uncertainty.

It is becoming increasingly obvious to more and more investors that avoiding large losses and controlling risk is the key to long-term investment success.

Alexander Ineichen, founder of IR&M said: “The key discipline in investment management is risk management. There is no such thing as return management. Large losses kill the rate at which capital compounds. Controlling for tail risk and negative compounding of capital is the essence for long-term investment success.”

Current institutional asset allocation methodology has some serious shortcomings. First, it starts with the risk-free rate of return. However, the term “risk-free rate of return” is in the process of turning into the mother of all oxymorons according to Ineichen. Second, the current process relies heavily on forecasting. However, the failure of most of the financial profession to see the last crisis coming should be cause of great concern. Thirdly, over-zealous regulation is increasingly determining the asset allocation of institutions. This regulation results in de-risking and favours bonds. Portfolios of pension funds and insurers hold government bond-heavy portfolios at a time where monetary aggregates are ballooning and a 30-year bull market in government bonds might soon start to look tired.

Ineichen warns: “Applying financial orthodoxy to the current investment environment could be ill-advised or much worse.”

In IR&M’s inaugural research report ("Europe doubling down"), Ineichen also suggests “lie watching”. The influence of politics is increasingly becoming more relevant in influencing market prices and trends.

“The authorities have a different axe to grind than have investors; they often need to lie. In today’s markets, spotting the lie is not just a profitable endeavour; it is as much a survival necessity,” Ineichen said.

The research consists of a quarterly write-up of which the inaugural issue is titled “Europe doubling down” and is attached to this press release. Weekly on-screen updates have been published since 5 August 2011. Investors can require a free trail for six months. The existing “absolute returns” research will continue to be free of charge.

(press release)

www.ineichen-rm.com


See our last articles on Ineichen:
24.06.2011 Opalesque Exclusive: Alexander Ineichen’s Regulomics research shows little to cheer alternative investors Source
14.12.2010 Opalesque Exclusive: But what is real absolute return? Buyers beware, says Ineichen Source
02.12.2010 Opalesque Exclusive: A. Ineichen: the real value of hedge funds is in active risk management, not alpha Source


BG

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
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: New systematic strategy managed alongside research firm outperforms S&P500[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: An emerging CTA manager explains how he runs his strategy, which is based on an index produced by a research firm. Peter Turk is head of

  2. Opalesque Exclusive: New systematic strategy embraces machine learning[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: The founder of a New York-based systematic trading firm, which offers a hybrid between alpha strategies and alternative feta at lower fees, describes his approa

  3. Larry Robbins' hedge fund Glenview buys 1m Tenet Healthcare shares[more]

    Komfie Manalo, Opalesque Asia: Glenview Capital Management said it bought an additional 979,482 shares at Tenet Healthcare Corp valued at $53.80 million, raising its stakes in the healthcare services company to 15.16%, reported

  4. Legal - Grayson’s hedge funds under scrutiny for possible ethics violations, Court rejects hedge fund’s motion to block merger of Samsung affiliates[more]

    Grayson’s hedge funds under scrutiny for possible ethics violations From Freebeacon.com: Rep. Alan Grayson is finding himself in hot water over managing hedge funds that bear his name, actions that are in possible violation of House ethics rules. Sitting members of Congress are prohibite

  5. Hedge funds panic over Greece[more]

    Komfie Manalo, Opalesque Asia: Some investors are in panic mode as Greek Prime Minister Alexis Tsipras announced Sunday night that the banks and the stock market would be closed Monday, said

 

banner