Foreword | p. viii |
Preface | p. ix |
Asset Allocation Insights | |
Essentials of Asset Allocation Mastery | p. 3 |
Overview | p. 3 |
Meanings and Elements of Mastery | p. 4 |
Foundations of Mastery | p. 6 |
Advantages and Drawbacks of Mastery | p. 8 |
Investing Perspectives on Alternative Investments | p. 9 |
Investing in an Environment Subject to Crises and Global Asset Market Dislocations | p. 13 |
Asset Allocation and Investment Lessons from University Endowments | p. 19 |
Overview | p. 19 |
Special Features of College and University Endowments | p. 20 |
Applications of Successful Endowments' Experiences to Other Investors | p. 24 |
Important Distinctions between Endowments and Other Investors | p. 29 |
Similarities in Approach by Harvard and Yale University Endowments | p. 32 |
Harvard University | p. 34 |
Yale University | p. 46 |
Underpinnings of Asset Allocation | |
Applications and Implications of Compound Interest | p. 59 |
Overview | p. 59 |
Selected Insights into Compound Interest | p. 60 |
Returns in the Form of Income versus Capital Gains | p. 69 |
Periodic Contributions and Periodic Withdrawals | p. 73 |
Spending versus Reinvesting Income Flows | p. 77 |
Coupon Reinvestment in Fixed-Income Securities | p. 87 |
Dividend Reinvestment in Equities | p. 93 |
Multiyear Rates of Return | p. 97 |
Asset Class Attributes | |
Multiyear Investment Performance of Selected Asset Classes | p. 109 |
Overview | p. 109 |
Investment Performance Parameters | p. 110 |
Multiyear Investment Performance Data | p. 111 |
Caveats in Multiyear Investment Performance Analysis | p. 126 |
Observations on Asset Classes' Investment Performance | p. 127 |
Understanding and Using Correlations | p. 133 |
Overview | p. 133 |
Definitions of Correlation | p. 134 |
Development of the Correlation Measure | p. 135 |
R-Squared Measure, or Coefficient of Determination | p. 137 |
Caveats to Correlations | p. 138 |
Correlation and Causation | p. 142 |
Absolute and Relative Values of Correlation | p. 144 |
Selected Types of Correlation Coefficients | p. 144 |
The Effects of Correlations on Portfolio Investment Performance | p. 146 |
Correlations as a Determinant of Portfolio Investment Performance | p. 148 |
Correlations Dynamics in Multiasset Portfolios | p. 150 |
Serial Correlations | p. 150 |
How Correlations Work in Mean-Variance Optimization Models | p. 154 |
Correlations of Returns between Asset Classes | p. 159 |
Overview | p. 159 |
Summary of 10-Year Overlapping Correlations | p. 160 |
Historical Perspective on 10-Year Overlapping Correlations between Equity Asset Classes | p. 161 |
Summary of Historical Perspective on 10-Year Overlapping Correlations between Fixed-Income Asset Classes | p. 163 |
Summary of Historical Perspective on 10-Year Overlapping Correlations between Alternative Investments Asset Classes | p. 167 |
Rolling 10-Year Correlations of Annual Returns | p. 170 |
Overview-Three-Year Nonoverlapping Correlations | p. 240 |
Summary of Historical Perspective on Correlations between Asset Classes-Equity | p. 240 |
Summary of Historical Perspective on Correlations between Asset Classes-Fixed-Income Securities | p. 242 |
Summary of Historical Perspective on Correlations between Asset Classes-Alternative Investments | p. 245 |
Nonoverlapping Three-Year Correlations of Monthly Returns | p. 247 |
Financial Markets Analysis and Investment Insights | |
Recognizing Cyclical and Secular Turning Points | p. 311 |
Overview | p. 311 |
Turning Points in an Asset Allocation Context | p. 312 |
Cyclical Analysis versus Secular Analysis | p. 315 |
Excesses That Potentially Indicate Turning Points | p. 317 |
Fundamental Excesses That Potentially Indicate Turning Points | p. 324 |
Valuation Forces | p. 348 |
Psychological, Technical, and Liquidity Forces | p. 376 |
Asset Bubble Phenomena | p. 383 |
Implementation Tactics and Strategies | |
Structural Considerations in Asset Allocation | p. 389 |
Overview | p. 389 |
Structural Considerations | p. 390 |
Financial Planning | p. 393 |
Personal Trusts | p. 396 |
Life Insurance and Annuities | p. 397 |
Tax Management | p. 405 |
Liability Management | p. 407 |
Information Sources | |
Information Management | p. 411 |
Overview | p. 411 |
Classifying Information Sources | p. 412 |
Strategies and Tactics for Information Management | p. 417 |
Information-Management Caveats | p. 420 |
Internet-Based Information Sources | p. 424 |
Optimizing Internet-Based Information Sources | p. 433 |
Sources of Information | p. 437 |
Media-Based Information Sources | p. 437 |
Conferences, Seminars, and Workshops | p. 447 |
Corporations and Individual Investor Organizations | p. 448 |
Educational Institutions and Research Institutes | p. 451 |
Governmental and Regulatory Bodies | p. 452 |
Nonprint Mass Media | p. 452 |
Periodicals, Newspapers, and Newsletters | p. 455 |
Subject-Based Information Sources | p. 483 |
Index | p. 511 |
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