A Potpourri of Popular Postings

It’s the holiday season, when things both speed up (with family commitments, travel, etc.) and slow down (business activity).  To celebrate, here is something completely different from the normal Fortnightly.  (We’ll be back to regular programming in January.  In the meantime, check out our new Bluesky account for interesting things to read.)

Below are links to and excerpts from some of this year’s most popular Investment Ecosystem postings — one from each of the categories in the archives.

“The Active Management Reinvention Project,” Asset Manager, July 30.

Active managers haven’t felt the need to innovate; given the profitability of the endeavor, there wasn’t any great advantage in bucking convention.  Consequently, a remarkable sameness came to pervade the craft, with little differentiation from firm to firm and across time.

“Does it Matter (How the Money is Made)?” Asset Owner, October 23.

Asset owners face dilemmas about whether the investment function ought to be an island unto itself, only concerned about the optimal risk/return profile for the portfolio, or whether other considerations ought to be factored into decision making.

“Thoughts about Asset Manager Pedigree,” Due Diligence, February 8.

For allocators who must seek the approval of others to get their ideas used, pedigree is an easy sell.  Whether the process involves convincing a chief investment officer or an investment committee that a recommendation should be given the green light and/or marketing a pick to institutions or individuals for their portfolios, playing the pedigree card can be very effective — but far too simplistic.

“Humans, AI, and Organizational Upheaval,” The Research Puzzle, November 4.

While the natural (and necessary) inclination will be to build AI expertise in your organization, laying the groundwork for a new cultural and collaborative framework will be just as important.

“The Advisory Dilemma: Personalized or Systematic?” Investment Advisor, May 9.

Decisions about customized versus personalized services alter the role of the individual investment advisor, who is the critical link between a client and the firm.  Is an advisor expected to implement advice created by others or to be involved in creating the advice? Is it an investment role or a relationship role?  What are the advisor’s obligations to the client in terms of assuring that the firm’s recommendations are in fact appropriate?

“A Devilish Lexicon of Investment Discourse,” Learning Curve, July 1.

The Devil’s Financial Dictionary explores the language of investment practice, providing a helpful perspective for investors — and raising a caution flag for professionals and organizations who think that business as usual is the way things ought to be.

“Emerging Managers, a Simple Process Framework, and Measuring the Moat,” Fortnightly, October 28.  As with all of the (normal) Fortnightly postings, this one included a wide variety of reads.  In addition to the title topics, there are items on gender differences in analyst reports, a bold take on fiduciary duty for investment advisory firms, a changed corporate credit landscape, private equity liquidity, an old Barton Biggs strategy piece, and much more.

Biggs stated his objections to the thought that there’s a simple function that connects the stock market to the bond market, questioning assumptions about the equity risk premium and noting that the present value machine “can’t factor in qualitative factors and secular change.”

Thank you for reading.  Many happy total returns.