Tag: systematic-investing

Process vs Outcome

Posted by Jon Robinson on 6/20/19 11:23 AM

In 1931, the New York Times, celebrating its 80th birthday invited eight American innovators to predict what life would be like in 80 years. Among them, Dr. William Ogburn, a sociologist, predicted that "people will become more nervous and mental disorders will rise for a time, but by 2011 mental hygienists will probably have the upper hand.” W.J. Mayo, the founder of the Mayo Clinic, said that by 2011, the average life span, then only 54, would rise to 70 (it was 78). As we have written before, market predictions are generally useless even when correct. Why is there such a fascination with predictions to begin with?

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Topics: Behavioral Finance, Systematic Investing

After the Bull Run?

Posted by Jon Robinson on 6/6/19 9:56 AM

In 2009, few could have imagined a 10-year bull market, the longest in U.S. history. To the delight of multitudes of investors (those who remained invested anyway), here we stand, giddy from experiencing record-high stock prices and record-low volatility.

But will it last?

Research shows that two-thirds of institutional investors believe the bull market in stocks will reach its end this year. Further, they expect the next financial crisis to come in one to five years, according to a Natixis survey.

The eternal question for financial advisors:

How do you instill discipline in clients when they face emotionally charged environments?

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Topics: Advisor Practice Management, Behavioral Finance, Systematic Investing

Smart Beta - A Tool and Not a Strategy

Posted by Jon Robinson on 4/24/19 1:42 PM

Blueprint believes a major preoccupation for investment advisors and financial planners has become their clients’ emotional quotient (EQ), as it surpasses the intelligence quotient (IQ) in the advisor value chain.

Advisors studying the Blueprint approach to systematic investing often ask the question of how Blueprint’s investment methodology differs from Smart Beta strategies that similarly rely on quantitative modeling.

Before answering this question, allow us to provide some context.

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Topics: Behavioral Finance, Systematic Investing

An Alternative to Liquid Alternatives - Updated

Posted by Jon Robinson and Joe Crawford on 4/11/19 10:25 AM

Nearly a year and a half ago, we published an original piece entitled “An Alternative to Liquid Alternatives.” At the time, we wrote: “many of the currently investible vehicles have not been truly tested in a dramatic drawdown environment like 2008.” Since publication, the investing landscape has changed substantially; interest rates are rising, the S&P 500 has endured a 20% drawdown, and the yield curve has inverted, to name just a few of the many notable developments.

Given the path of global markets since Oct 2017, there has been ample opportunity for liquid alts to prove their mettle, so we thought it was time to update the data for one of our most popular blogs. Let’s look at the revised story…

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Topics: Behavioral Finance, Systematic Investing

Does Zero Equal Free?

Posted by Jon Robinson on 3/13/19 10:03 AM

The race to zero in the ETF world has its first winner.  On February 25th, online personal financial services company Social Finance, Inc. (SoFi) announced the industry's first zero-fee ETFs. The filing consists of four ETFs in total, with two of the funds (SFY, SFYX) having fee waivers in place until at least March 27, 2020, effectively bringing their total fund expenses to zero for the first year of operation. But much like a buy one get one free offer, it is not immediately evident that a zero fee ETF is always a good value. We believe there is more to the story, and make the case below.

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Topics: Behavioral Finance, Systematic Investing

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