aiCIO - A Neurology Lesson for Money Managers
Chief Investment Officer-CIO - A Neurology Lesson for Money Managers:
Nice short list (8 points) on how neuroeconomics effects money managers from Paul Zak.
"The crossover applications between neurology and economics don’t end there. In fact, an entire discipline has sprung up in their midst: neuroeconomics. Two leaders in this field have teamed up and crafted a list of the eight crucial
Why You Shouldn't Think Of The S&P 500 As A Diversified Basket Of 500 Companies - Seeking Alpha
Why You Shouldn't Think Of The S&P 500 As A Diversified Basket Of 500 Companies - Seeking Alpha:
The S&P, like most indexes, is a market-weighted index. So the larger the stock, the more the influence. This is demonstrated in this article from Seeking Alpha:
Two look-ins:
"...the top five holdings of the Vanguard S&P 500 ETF (VOO). They are Apple (AAPL), Exxon (XOM), General Electric (GE),
Hedge funds disappoint -- again - CBS News
Logo of CBS News (Photo credit: Wikipedia)
Hedge funds disappoint -- again - CBS News:
While this says nothing about the hedge aspects (may be a good low correlation investment), it does suggest that at Hedge funds are not the be all and end all that some suggest.
"Over the past five years, the S&P 500 returned 1.7 percent per year, producing a cumulative return of 8.6 percent, while the
Which Volatility Hedged ETF Should You Consider? - Zacks.com
Which Volatility Hedged ETF Should You Consider? - Zacks.com
A must for SIMM class where we just mentioned this in class:
"The tail risk hedge takes care of extreme market volatility which can potentially result in a crash. Therefore these events are considered to be outliers which normally do not fall within three standard deviations of the average of the implied volatility.
The
Are women better investors?
Female hedge fund managers outperformed male managers in 2012
"Meredith Jones, director at Rothstein Kass and the author of the
report, believes there are two primary factors at play in the
exceptional performance of women in alternative investments.
Women tend to be more risk-averse than men. “Women may be better
equipped to position a portfolio to handle market volatility which we
Before Facebook Deal, Instagram's Talks With Twitter - NYTimes.com
Before Facebook Deal, Instagram's Talks With Twitter - NYTimes.com:
This one will be talked about for years:
"Facebook’s deal to buy Instagram for $1 billion stunned Wall Street and Silicon Valley when it was announced in April. But executives at Twitter had an additional reason to be surprised. Instagram’s founders “held several meetings as late as March with top Twitter executives,” The New
This one will be talked about for years:
"Facebook’s deal to buy Instagram for $1 billion stunned Wall Street and Silicon Valley when it was announced in April. But executives at Twitter had an additional reason to be surprised. Instagram’s founders “held several meetings as late as March with top Twitter executives,” The New
Irving Fisher, the First Celebrity Finance Professor - Bloomberg
Irving Fisher, the First Celebrity Finance Professor - Bloomberg:
A history lesson on the man behind the "Fisher effect"
"Fisher developed revolutionary insights into financial theory that are still invoked today. He explained that the market interest rate coincides with the human tendency to discount an uncertain future when compared with the more pressing present. He argued that we distribute
A history lesson on the man behind the "Fisher effect"
"Fisher developed revolutionary insights into financial theory that are still invoked today. He explained that the market interest rate coincides with the human tendency to discount an uncertain future when compared with the more pressing present. He argued that we distribute
Take the money: Why we make better financial decisions for strangers than family
Take the money: Why we make better financial decisions for strangers than family
This
one should not really surprise anyone and is essentially the logic
behind my recent test question of "what is the role of a financial
planner in the face of investors prone to behavioral biases".
"They
found participants were more likely to select a smaller immediate
reward than delay for a larger
Why Should Hostess Executives Get The Bonuses They're Demanding? - Forbes
Why Should Hostess Executives Get The Bonuses They're Demanding? - Forbes:
"AP is reporting that the Irving, Texas company is planning to ask a bankruptcy judge to grant approval of bonuses totaling up to $1.8 million for its executives....It’s tough to see why managers should get bonuses for driving a company into the ground and sacrificing some 18,000 jobs. Hostess had become horribly
"AP is reporting that the Irving, Texas company is planning to ask a bankruptcy judge to grant approval of bonuses totaling up to $1.8 million for its executives....It’s tough to see why managers should get bonuses for driving a company into the ground and sacrificing some 18,000 jobs. Hostess had become horribly
Former baseball star Doug DeCinces indicted for insider trading - Yahoo! Finance
Former baseball star Doug DeCinces indicted for insider trading - Yahoo! Finance:
"DeCinces was charged with 42 counts of criminal securities fraud and one count of money laundering over the 2008 purchase of stock in a medical device company based on insider information, according to an indictment filed in a federal court in Southern California.
DeCinces, 62, bought $160,000 worth of stock in
"DeCinces was charged with 42 counts of criminal securities fraud and one count of money laundering over the 2008 purchase of stock in a medical device company based on insider information, according to an indictment filed in a federal court in Southern California.
DeCinces, 62, bought $160,000 worth of stock in
How Do Banks React to Increased Asset Risks? Evidence from Hurricane Katrina by Claudia Lambert, Felix Noth, Ulrich Schuewer :: SSRN
How Do Banks React to Increased Asset Risks? Evidence from Hurricane Katrina by Claudia Lambert, Felix Noth, Ulrich Schuewer :: SSRN:
Two takeaways:
Banks increase risk-based capital ratios in times of great uncertainty.
The increase comes largely from well capitalized banks and by reducing loans.
From the Abstract:
"[We] find that banks in the disaster areas increase their risk-based
Two takeaways:
Banks increase risk-based capital ratios in times of great uncertainty.
The increase comes largely from well capitalized banks and by reducing loans.
From the Abstract:
"[We] find that banks in the disaster areas increase their risk-based
Diversifcation: good but not as good as you probably think
Index cohesive force (Photo credit: Wikipedia)
For years (at least since 2001) this idea has been a
mainstay in my classes. The benefits of diversification have been
overstated. Why? The correlations that are used to diversify and get
the so called optimal portfolio change and the change is NOT in a random format:
the correlations go up in bad times.
The Physics of Finance: Why
'Drunken' Broker Sent Oil to 8-Month High in 2009: Report - US Business News - CNBC
'Drunken' Broker Sent Oil to 8-Month High in 2009: Report - US Business News - CNBC:
"...an admin clerk called Perkins to ask why he had bought 7 million barrels of crude during the night. Perkins had no recollection of the transactions, and it turned out that he had made the trades during a “drunken blackout," according to the FSA."
"...an admin clerk called Perkins to ask why he had bought 7 million barrels of crude during the night. Perkins had no recollection of the transactions, and it turned out that he had made the trades during a “drunken blackout," according to the FSA."
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