29 Aug 2017

Forecasting Expected Returns

“Price is what you pay.  Value is what you get.”  -Warren Buffet How can investors know the value of an investment?  Bond yields remain very low and stocks continue to climb higher across the globe.  Using typical valuation measures, markets everywhere look very expensive.  However, investors continue to pour money into them, so they must see value.  The value of an investment is subject to an uncertain future, so how… Read More

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8 Sep 2015

California Pension Funds Intriguing Duel

One of the big stories inside the investment community over the past 18 months is the announcement by the California Public Employees Retirement System (CalPERS) that they are eliminating their hedge fund exposure and significantly cutting back their private equity exposure (which we wrote about here and here). These are two of the three asset classes that large institutions use that we don’t (the third being direct investment in commercial… Read More

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30 Jan 2015

Those Clever Institutional Investors

Maybe I’m a little hung-up on this, but I am always a little annoyed when institutional investors look down their noses on retail investors. When a bull market is finally getting going, you’ll hear them sniff that ‘retail is finally waking up,’ or when markets are falling, they’ll say that the losses are exaggerated because retail is selling into the downturn. No matter what markets are doing, institutional investors seem… Read More

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22 Sep 2014

What if You Called The Bond Market Perfectly?

It’s an interesting question. The ability to call the tops and bottoms with perfect accuracy is considered the “holy grail” of bond market investing. We spend a great deal of effort talking to clients about the risk of trying to make speculative calls – the risk of being wrong of course. Just as an exercise I thought it would be neat to imagine what it would be like if we… Read More

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5 Mar 2014

Acropolis vs the Yale Endowment

Just as I enjoy and learn from Warren Buffets annual letter to Berkshire stockholders, I also read and get a lot of value from the annual report from Yale’s endowment.  Here’s a link to the current report. Yale’s endowment is the largest in the world and has enjoyed spectacular investment performance, particularly under the stewardship of David Swensen, who wrote one of my favorite investing books of all time, Pioneering… Read More

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21 Jan 2014

Acropolis vs Harvard Endowment

I didn’t apply to Harvard because I was certain that they would not admit me. My grades were fine and scores were so-so, but at that time they were accepting only nine or ten percent of applications and I knew that the other kids had top grades and scores AND were fluent in four languages, captain of multiple teams and fought poverty on the side. Or, worse yet, their parents… Read More

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