Risk has many dimensions and individual investors tend to equate risk with loss of capital. That definition of risk may actually lead an investor astray and hinder his or her ability to meet long-term objectives. Rather than attempting to avoid risk, successful investors embrace and manage it. For private investors, one of the keys to success is setting strategic investment goals and remaining focused on the long term, without being distracted by short-term noise.
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Most teenagers have heard that investing early in life is a way to build wealth over time. They've most likely heard that buying stocks is a common way to invest. In this video, they learn what stocks are and how they are sold and purchased. They will also discover the benefits that stocks offer to investors.
There is a growing realization among impact investors and those who seek to influence society that they can use more of their assets to complement and even accelerate their social impact goals. This guide provides the tools to develop and execute a tailored impact investing strategy. It offers an objective, agenda-free resource that will inspire readers while also being realistic about the limitations and possibilities of this increasingly popular investment strategy. New approaches are proposed while keeping the principles of traditional investing in mind.
Commodity investors have historically recognized a link between the strength of the U.S. dollar and the prices of commodities. Specifically, as the dollar strengthens against other major currencies, commodity prices generally tend to fall, and vice versa. A further examination is provided on why this may be the case, and whether it’s true at the individual commodity level as well as across all commodities, and what it ultimately means for investors.
Private equity has been an established asset class for institutional and private investors for well over two decades. The potential for outsize returns and exposure to the most exciting and innovative companies continues to drive investors toward the asset class.
We are currently experiencing one of the longest periods of U.S. dollar strength in the last 50 years, leading some to question if it’s time for a reversal. Learn what drives the dollar and how it impacts various asset classes and influence portfolio positioning.
When it comes to an investment strategy, it is important to consider the tracking error (TE) as it allows investors to quickly get a sense of how much deviation from a stated benchmark they could expect. This guide offers a brief explanation of the TE concept and descibes how it can be used to establish benchmark-relative performance expectations, and concludes with some statistical detail and common misconceptions. We'll also discuss the differences between realized and predicted TE.
Investors have been building bond portfolios using a laddered strategy since the early 1900s. Even in a flat or rising rate environment, a ladder’s total return can materially exceed its starting yield through the phenomenon of roll-down. The benefits of roll-down relate directly to the shape of the yield curve. To demonstrate how roll-down works, a few intuitive examples are provided.
When in the pursuit of enhanced risk-adjusted returns, investors with strong convictions are often drawn to factor investing—tilting portfolios toward a particular factor like value, low volatility, or dividend yield. While it may seem counterintuitive, a factor portfolio’s tracking error is a useful tool for ensuring they’re not taking on too much risk or unintended exposure in an attempt to generate benchmark-beating returns.
Investor anxiety is shifting from the impact of COVID-19 to the changes that may come with the removal of stimulus measures. Investors can make the transition to a new market cycle by managing their risks. Three examples, including taking advantage of dislocations, are provided to help investors prepare their portfolios.