Long‐horizon investors have an edge. This paper argues to take advantage of the long-run investors should institutionalise contrarian behaviour by adopting a rebalancing rule, and redefining the concept of risk away from just volatility.The paper can be accessed below
Risk Management, risk measurement, volatility
Singapore’s two largest asset owners, GIC and Temasek, see attractive opportunities in climate adaptation solutions – a relatively underfunded area compared to decarbonisation. The former has already made selective adaptation investments and said the opportunity set across public and private debt and equity could increase to $9 trillion by 2050.
This analysis suggests that without a well-developed domestic financial market, the value of the Chinese currency (renminbi) may significantly depreciate, instead of appreciate, once the Chinese government abandons the linked exchange rate and the massive amount of precautionary savings of Chinese households are unleashed toward international financial markets to search for better returns.mrec4inarticleinline Sponsored Content
This collaborative research examines the relationship between hedge fund managers’ fee structures and the amount of risk taken and among other things finds a “high-powered incentive fee” encourages excessive risk-taking, while management fees have the opposite effect.mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3
Subjecting money market funds to a bank-like regulatory structure would disrupt the short-term money market and increase systematic risk according to this Yale Law School paper. While risk-limiting reforms are important to ensure the continued safety and security of MMFs, this paper argues major revisions such as the floating NAV requirement or bank-like regulation would
Empirical literature and MSCI analysis show that high implementation costs indicate there is little evidence the average managers in either emerging market or small caps have produced either higher or more persistent risk-adjusted returns relative to their developed market and mid-cap peers. mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3
Treasury inflation-protected securities (TIPS) have a relatively unique profile within fixed income portfolios, which has important implications for investors’ setting of objectives and portfolio construction. This Towers Watson article explores the different motivations for using TIPS and other inflation hedges.mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3
This article by Dubravko Mihaljek and Frank Packer from the Bank for International Settlements, reviews the derivatives market in emerging market economies, attempting to answer some basic questions such as how big the market is, who trades, which derivatives are most traded and how it differs from mature markets.mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3
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