30 Nov 2015

Performance Fees Get Exposure

The California Public Employees’ Retirement System (Calpers) is back in the news again (I’ve written about them previously here and here). This time, they’ve decided to disclose how much they’ve paid in performance fees to private equity fund managers and the number is a whopper at $3.4 billion. Private equity, hedge funds and some other kinds of private funds are paid on what is known as a ‘2 and 20’ schedule which… Read More

23 Nov 2015

A Free Lunch for Thanksgiving

Back in May, I wrote about the 13D Activist fund (ticker: DDDIX), which buys stocks that are popular among activist hedge funds like Nelson Petlz and Bill Ackman (click here for my article). Although I did say that it wasn’t a great fund for Acropolis, I thought it was interesting because it had actually delivered alpha – returns that couldn’t be explained by factors like value, momentum, size and quality…. Read More

20 Nov 2015

Possible Law Changes Beyond File and Suspend

Back in 1995, I subscribed to the big industry rag for stock brokers, Registered Rep Magazine.  Twenty years later, I still get the magazine, although I haven’t held a broker’s license (the Series 7) for more than a decade. When I sat down to read it a few days ago, I was struck by one of the articles, which said that the popular Social Security maximization strategy, File and Suspend,… Read More

19 Nov 2015

Injured Unicorns Spotted in Silicon Valley

As opposed to the horse with a single, spiraling horn projecting from its forehead, today’s unicorn describes privately held start-ups that are worth more than $1 billion: think Uber, AirBnB, Snapchat or Pinterest (actually, these are all considered ‘deca-corns’ because they are worth more than $10 billion). Current estimates suggest that there are now 143 unicorns in existence today and are supposedly worth half a trillion dollars, but it’s actually hard… Read More

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18 Nov 2015

What Retirees (and Pre-Retirees) Worry About

One of the interesting (but less than encouraging) data points in the inflation data is that medical care service costs increased 3.0 percent in the 12 months ending in October while core inflation was 1.9 percent (core inflation excludes volatile food and energy costs). Everyone at Acropolis knows that retirees and pre-retirees worry a lot about healthcare costs.  A recent UBS study of 1,849 high net worth individuals with an… Read More

17 Nov 2015

A Big Bet on Emerging Markets

For most of last week, I was in Boston at Schwab’s IMPACT conference – my fourteenth pilgrimage that includes prominent speakers, workshops and a football field size area of vendors pitching everything under the financial services sun. This year featured more academics than usual, which I found particularly engaging.  One of the sessions was actually a debate between academic Roger Ibbotson (who also manages some money) and Rob Arnott, a… Read More

16 Nov 2015

We Stand with France

Like the rest of the world, we are all shocked and saddened by the horrific terrorist attacks in France. I’m reminded of my first days with Acropolis, although technically, we were everTrade Advisors back then.  My first official act was to write a letter to clients in the days following 9/11.  I don’t think I had been on the job more than a week or two when it happened. There wasn’t… Read More

12 Nov 2015

Navigating Bond Market Holidays

Yesterday was Veterans Day. A Federal holiday in the US where we honor those who have served in our country’s military during wartime and peacetime. But it also makes for something a bit strange in the financial markets. If Veterans Day falls on a weekday, the stock market is open while the bond market is closed. Because we are sensitive to transaction costs and realizing capital gains in our client’s… Read More

10 Nov 2015

When Hedge Funds Come and Play

One of the ongoing fall soap operas in Wall Street right now concerns Valeant Pharmaceuticals (ticker symbol: VRX), which develops and manufactures a range of specialty generic and branded drugs. The stock had been one of the darlings of Wall Street after it had risen from around $35 per share in 2010 to over $260 per share in August.  Yesterday, the stock closed at $85 per share, a decline of… Read More

9 Nov 2015

Jobs Report Gives Fed Ammunition

All markets were driven Friday by the Labor Department report which showed that US employers added jobs in October at the fasted past so far this year while wages rose at the fastest rate since 2009. Nonfarm payrolls rose by a seasonally adjusted rate of 271,000 last month and revisions for August and September added 12,000 more jobs than previously estimated, bringing the monthly average of 206,000. The newly created jobs… Read More