21 Sep 2015

Bonds Funds at 84 Cents on the Dollar

One of the smaller, but still very interesting types of securities are closed-end funds (CEF).  While traditional mutual funds (technically called open-ended funds) are much larger, the CEF market dates back to 1893 – 30 years before the first mutual fund. The major distinction between the two fund types (ignoring exchange-traded funds, or ETFs) is that mutual funds continuously create new shares as new investors come into the fund and shares… Read More

By David Ott Tags:
3 Sep 2015

The Chart That Made Me Laugh Out Loud

I think you know by now that I love charts.  I am definitely not saying that I am a chartist – I don’t think I have ever made an investment decision for me or anyone else based on a chart.  I simply think that if a picture tells a million words then a chart must at least tell 1,000 (roughly matching my wordcount) When I saw a blog titled ‘econompic,’… Read More

By David Ott Tags:
19 Aug 2015

High Yielding Asset Classes

Given the low interest rate environment that we’ve endured over the last several years, a lot of our clients ask how we can increase the yield of our portfolios. While yield is an important component of total return (which is income and appreciation/deprecation together), we sometimes see investors stretch for yield without fully understanding the consequences of their decisions. The table below shows the SEC-yield (which is a whole story… Read More

By David Ott Tags:
25 Jun 2015

ALM Insights – June 2015

ALM Insights is focused on banks and other institutions that use their portfolio to manage risk on both sides of their balance sheet. It takes an in-depth look at securities investment strategies, balance sheet and asset/liability strategies, regulatory topics and general economic information. To view this issue, click the image below. In This Issue: Is Bond Market Liquidity Gone? Is Janet Bluffing? Looking at Deposit Alternatives

By Cliff Reynolds Tags: , , ,
16 Jun 2015

A Wall Street Creation Working FOR Investors

The investment management industry has been dominated by just a small handful of trends over the last decade: the growth of passive versus active funds, the birth of alternative strategies in mutual funds, the explosive proliferation of exchange traded funds (ETFs) and the overwhelming acceptance of target-date funds. Of those topics, the only one that I haven’t already covered (as denoted by the blue hyperlink) is the overwhelming acceptance of target-date fund (TDFs)…. Read More

By David Ott Tags:
13 Apr 2015

Old Advice, as Valuable as Ever

When my wife and I got married more than 15 years ago, we had a lot of things in common including the fact that we had both inherited stock in GE.  In fact, it was about 10 percent of our combined net worth.   I don’t remember the exact numbers anymore, but the cost basis on the stock was low for both of us because each of us had separately… Read More

By David Ott Tags:
24 Mar 2015

ALM Insights – March 2015

ALM Insights is focused on banks and other institutions that use their portfolio to manage risk on both sides of their balance sheet. It takes an in-depth look at securities investment strategies, balance sheet and asset/liability strategies, regulatory topics and general economic information. To view this issue, click the image below. In This Issue: At Least We Aren’t Europe Bond of The Day – When Does 2% ≠ 2%? More Problems… Read More

By Cliff Reynolds Tags: , , , , , , , ,
10 Mar 2015

A Bear Market Strategy

When I was a senior in college, and just starting to take some finance classes, my professor expressed deep concerns about the stock market’s valuation at the time. Of course, at the time I had no idea what he was even talking about, let alone an opinion about whether he was right or not. Using my trusty Bloomberg terminal, I can see that the price-earnings (PE) ratio for the S&P… Read More

By David Ott Tags:
18 Feb 2015

Mutual Funds: Decisions, Decisions..

In a recent issue of one of our industry trade ‘rags,’ the following chart really caught my eye: The chart shows the number of mutual funds by category in the US, according to Morningstar. It’s hard to read, but back in 1990, there were 665 US stock funds, 123 non-US stock funds, 481 taxable bond funds and 686 funds that fall into the ‘other’ category (I am guessing that they… Read More

By David Ott Tags:
11 Feb 2015

Black Box Investing

I am a big fan of quantitative investing, although that term is often misapplied in my judgment, so let me define what I mean by that term. When I say quantitative investing, I am simply referring to a process driven approach to evaluating securities and making decisions. ‘Quant’ investors typically rely on computers to organize and evaluate data that serves as input in the decision making process. The financial press… Read More

By David Ott Tags: