Discover and read the best of Twitter Threads about #AssetAllocation
Most recents (24)
Here are some highlights from the Voices of Tomorrow Bangalore Chapter! (1/n)
#VoicesofTomorrow #VoT2023 #ithoughtVoT #ithoughtVoT2023
#VoicesofTomorrow #VoT2023 #ithoughtVoT #ithoughtVoT2023
Session #01
ithought Way – The Journey by Mr Shyam Sekhar
Mr @shyamsek answers the question, ‘What pain points does ithought address & solve?’ (2/n)
#ithought #portfoliomanagement #financialplanning
ithought Way – The Journey by Mr Shyam Sekhar
Mr @shyamsek answers the question, ‘What pain points does ithought address & solve?’ (2/n)
#ithought #portfoliomanagement #financialplanning
“We want to make Millennials as $ Millionaires – a well-managed wealth corpus for the 90’s born.” - @shyamsek on what ithought wants to accomplish.
Watch Mr Shyam Sekhar’s talk ‘ithought Way – The Journey’ here youtube.com/live/Gyg3D2djS… (3/n)
#investors #investearly
Watch Mr Shyam Sekhar’s talk ‘ithought Way – The Journey’ here youtube.com/live/Gyg3D2djS… (3/n)
#investors #investearly
Here is this Week’s Market Wrap!
Time to Build a Multi-Asset Portfolio
A Thread! (1/n)
#multiasset #portfoliomanagement #marketwrap #thread
Time to Build a Multi-Asset Portfolio
A Thread! (1/n)
#multiasset #portfoliomanagement #marketwrap #thread
Most investors have been favouring equity for the last 2 years. Recency bias nudges investors to think that equity is the only asset class to bet on.
It is this bias that kept investors from buying gold. (2/n)
#investors #equity #stockmarket #gold
It is this bias that kept investors from buying gold. (2/n)
#investors #equity #stockmarket #gold
Investors thought that gold wouldn’t do well. The post-COVID rally in #cryptos spooked the prospects of gold & added to that conviction. But that conviction has proved to be short-lived, and gold did exceptionally well in 2022. (3/n)
#gold #investments #personalfinance
#gold #investments #personalfinance
A confluence of unprecedented events in 2022 weakened asset prices across all markets. (1/n)
#assetallocation #investing #personalfinance #throwback #thread
#assetallocation #investing #personalfinance #throwback #thread
The Fed’s pivot to a less aggressive monetary policy is likely to set the tone for the markets in 2023. (2/n)
#FED #FederalReserve #monetarypolicy
#FED #FederalReserve #monetarypolicy
It is expected that global inflation will continue to be higher in this decade, in combination with a significant slowdown of the U.S. economy. (3/n)
#inflation #interestrates #globalmarket
#inflation #interestrates #globalmarket
#assetallocation
@cppinvestments have ~ CAD 520B AUM.
This was really interesting, especially b/w the 10th-43rd minute mark and most of all, at the 22 minute mark when defining investment horizon:
1/3
@cppinvestments have ~ CAD 520B AUM.
This was really interesting, especially b/w the 10th-43rd minute mark and most of all, at the 22 minute mark when defining investment horizon:
1/3
2/3
‘Investment horizon = the length of time one can remain committed to an investment strategy that is broadly performing as expected without getting stopped out.’
‘Investment horizon = the length of time one can remain committed to an investment strategy that is broadly performing as expected without getting stopped out.’
3/3
‘One of the biggest errors we can make as investors is believing we have a longer time to prove out an investment approach than we really do.’
Topical. Very topical.
‘One of the biggest errors we can make as investors is believing we have a longer time to prove out an investment approach than we really do.’
Topical. Very topical.
Have you ever wondered how much you need to save for your retirement? Ever wonder if you will make it or fall short?
Over 600+ clients have benefited from our Financial Planning engagement!
Here are FIVE ways financial planning can help you! (1/13)
#financialindependence
Over 600+ clients have benefited from our Financial Planning engagement!
Here are FIVE ways financial planning can help you! (1/13)
#financialindependence
Before we begin, financial planning is a very personalised process. Every person's need is different. That is why we aim to craft tailor-made financial plans to meet each individual's needs. (2/13)
#financialplanning #personalfinance #savingstips
#financialplanning #personalfinance #savingstips
#1 Achieving Your Goals
Managing your finances in a way through which we can help you meet your goals is the crux of the planning process.
Proper planning can help you accomplish goals that you thought were far out of reach! (3/13)
#financialplanning #financialgoals
Managing your finances in a way through which we can help you meet your goals is the crux of the planning process.
Proper planning can help you accomplish goals that you thought were far out of reach! (3/13)
#financialplanning #financialgoals
1/n #RED #ALERT !! This has to REACH MAXIMUM people so people #RETWEET. You will Understand ONLY when you have read it. I have been talking about the Impact of Interest Rates on #AssetAllocation. There could be NOBODY ELSE world-over who understands this, better than #LarryFink
2/n In response to a question potential for client rebalancing into fixed income just as rates and markets eventually stabilize.
ANSWER: “Traditional 60-40 allocations are certainly at a balance, and portfolio liquidity profiles have also been impacted.”
ANSWER: “Traditional 60-40 allocations are certainly at a balance, and portfolio liquidity profiles have also been impacted.”
3/n “for the first time in years, investors can actually earn very attractive yields without taking much duration or credit risk. Just a year ago, the U.S. two-year treasury notes were yielding 25 basis points”
If #retirement is on the list of #goals you’re investing for, should the current high #inflation lead to any change in your plans? Here’s our take: (1/5)
If annual inflation is at 7%, monthly #expenses of Rs 50,000 per month today, would become Rs 1.9 lakhs per month, in 20 years. At 5% inflation, it would become only Rs 1.3 lakhs per month. It’s best to overestimate, err on the side of caution and invest accordingly. (2/5)
At the same time, it doesn’t help to panic and look only at the short term. Just stick to your #assetallocation, and continue your SIPs. If you think your #SIP investments won’t take you closer to your retirement goal, consider increasing allocation to equity MFs. (3/5)
As the world watches the Twitter vs #ElonMusk saga unfold, and questions, “What is happening?”, let’s take look at a question that’s been on many investors’ minds for a while - “What does #assetallocation actually mean, and why should I care?” (1/6)
#AMCs are manufacturers and will offer a basket to select from. Would anyone have invested if they came with NFO in March 2020?
It is duty of #Advisors/#Investors to invest or ignore. Just because AMCs offer is no criteria to invest.
Need to introspect before blaming others
It is duty of #Advisors/#Investors to invest or ignore. Just because AMCs offer is no criteria to invest.
Need to introspect before blaming others
Same is the case with IPOs, their timings and their valuations. Companies also come with #IPOs when markets were on a roll.
Again, investors had a choice to invest or ignore.
They invested with GREED and FOMO and now blaming others for these IPOs bombing
Again, investors had a choice to invest or ignore.
They invested with GREED and FOMO and now blaming others for these IPOs bombing
Why can't #Investors respect market signals? When going was good, they ignored advice of following #AssetAllocation.
When markets are bleeding, looking at scapegoats for their own actions.
This is #SelfAttribution bias. All good - their skill, all bad - blame it on others
When markets are bleeding, looking at scapegoats for their own actions.
This is #SelfAttribution bias. All good - their skill, all bad - blame it on others
🚨Worth studying: 👇
"The Anatomy of the Bond Market Turbulence of 1994" - Bank for International Settlements
link in thread below. 🧵
#banks #riskparity #assetallocation #risk #riskmanagement #rates #us10y #bonds
1/
"The Anatomy of the Bond Market Turbulence of 1994" - Bank for International Settlements
link in thread below. 🧵
#banks #riskparity #assetallocation #risk #riskmanagement #rates #us10y #bonds
1/
2/
Link to the paper from Bank of International Settlements
#banks #riskparity #assetallocation #risk #riskmanagement #rates #us10y #bonds
bis.org/publ/work32.pdf
Link to the paper from Bank of International Settlements
#banks #riskparity #assetallocation #risk #riskmanagement #rates #us10y #bonds
bis.org/publ/work32.pdf
3/
📉@FortuneMagazine's coverage in 2013 for the 1994 Great Bond Massacre.
#banks #riskparity #assetallocation #risk #riskmanagement #rates #us10y #bonds
fortune.com/2013/02/03/the…
📉@FortuneMagazine's coverage in 2013 for the 1994 Great Bond Massacre.
#banks #riskparity #assetallocation #risk #riskmanagement #rates #us10y #bonds
fortune.com/2013/02/03/the…
Update of #AssetAllocation strats in my package with yesterday's return. Brutal.
Worst static allocation: Sandwhich -12.4% YTD
Worst tactical allocation: Dual momentum -7.9% YTD
Best (least worse) static: Conservative income -6.85%
Best tactical: Ivy +1.36%
Worst static allocation: Sandwhich -12.4% YTD
Worst tactical allocation: Dual momentum -7.9% YTD
Best (least worse) static: Conservative income -6.85%
Best tactical: Ivy +1.36%
YTD statistics for static allocations.
All max drawdown for the year = cumulative return
A quick thread on Asset Allocation
Asset Allocation is an essential component of anyone's investment journey!
Fancy translation; asset allocation is the breakdown of different investments in the categories known as asset classes. Stocks, bonds, cash are different asset classes.
Asset Allocation is an essential component of anyone's investment journey!
Fancy translation; asset allocation is the breakdown of different investments in the categories known as asset classes. Stocks, bonds, cash are different asset classes.
Within each asset class, there are more breakdowns that categorize each investment like market capitalization, sectors, geographical locations etc. etc.
But in practicality, asset allocation is to diversify depending on an investor's risk tolerance.
But in practicality, asset allocation is to diversify depending on an investor's risk tolerance.
Each asset class has anticipated risk and return based on historical averages.
Based on how much risk an investor is willing to take, a portfolio can be broken down within several categories to provide diversification and balance.
Based on how much risk an investor is willing to take, a portfolio can be broken down within several categories to provide diversification and balance.
An educational #Thread on Personal Finance Rules we all must know. Have sorted the rules & explained those which are less known to every1 & are very imp. as got many requests to share in details.
Rule of 70
4% Rule for Financial Freedom
100 minus ur age rule
50-30-20 Rule
1/n
Rule of 70
4% Rule for Financial Freedom
100 minus ur age rule
50-30-20 Rule
1/n
1) "Rule of 70"
Divide 70 by current #inflation rate to know how fast the value of ur investment will get reduced to half its present value.
Inflation rate of 8% will reduce the value of ur money to 1/2 in 8.75 yrs.
1 should always consider while calculating net returns!
2/n
Divide 70 by current #inflation rate to know how fast the value of ur investment will get reduced to half its present value.
Inflation rate of 8% will reduce the value of ur money to 1/2 in 8.75 yrs.
1 should always consider while calculating net returns!
2/n
3) "4% Rule for Financial Freedom"
Corpus Required = 25 times of ur estimated Annual Expenses.
E.g- if ur annual expense after 45 years of age is 500,000 and u wish to take VRS then corpus with u required is 1.25 crore.
Put 50% of this in fixed income & 50% into equity.
Cond.
Corpus Required = 25 times of ur estimated Annual Expenses.
E.g- if ur annual expense after 45 years of age is 500,000 and u wish to take VRS then corpus with u required is 1.25 crore.
Put 50% of this in fixed income & 50% into equity.
Cond.
Lot of #AMCs come up with different ideas, themes, sectors.
These are demands from #Investors as they have done well in recent past.
AMCs are manufacturers & will offer what is in demand.
Final choice to say YES or NO lies entirely with Investors based on their #NEEDs
These are demands from #Investors as they have done well in recent past.
AMCs are manufacturers & will offer what is in demand.
Final choice to say YES or NO lies entirely with Investors based on their #NEEDs
What should investors choose and what should they ignore. A point by point guide on where and why to invest in certain #themes, #MarketCap bias, #Sectors, #AssetClasses etc.
What should be criteria for these selections and what should guide them to resist from Investing?
What should be criteria for these selections and what should guide them to resist from Investing?
Lets start with #Debt:
Keep enough money as 1 year of your expenses as #EmergencyFunds in #LiquidSchemes
You already have enough exposure to debt as:
1. #PPF
2. #TaxFreeBonds
3. #FDs
No need for separate debt allocation if you are investing thru #AssetAllocation (AA) or #DAAF
Keep enough money as 1 year of your expenses as #EmergencyFunds in #LiquidSchemes
You already have enough exposure to debt as:
1. #PPF
2. #TaxFreeBonds
3. #FDs
No need for separate debt allocation if you are investing thru #AssetAllocation (AA) or #DAAF
We have been told following:
1. Time in market more important than timing the market
2. Long Term is 5 yrs plus
Chart will prove the above wrong. First, timing the market is more important then time in the market
Entry as important as Exit points. There are many such examples
1. Time in market more important than timing the market
2. Long Term is 5 yrs plus
Chart will prove the above wrong. First, timing the market is more important then time in the market
Entry as important as Exit points. There are many such examples
Investing at right Valuations is of paramount importance
Cannot buy at any levels and expect good returns going forward
If bought at expensive valuations-long term may change from 5 to 7 to 10 years
From 01-01-08 to 01-01-21 - 14 years NIFTY - 7.63% p.a. -sub optimal returns
Cannot buy at any levels and expect good returns going forward
If bought at expensive valuations-long term may change from 5 to 7 to 10 years
From 01-01-08 to 01-01-21 - 14 years NIFTY - 7.63% p.a. -sub optimal returns
When one invests at expensive valuations-like current period, you are eating into future returns
In such instances, tone down your future returns expectations
Otherwise you will have regrets and disappointments in future
Invest wisely without having #FOMO thru #AssetAllocation
In such instances, tone down your future returns expectations
Otherwise you will have regrets and disappointments in future
Invest wisely without having #FOMO thru #AssetAllocation
1 A thread on our new article on the US markets (mis) valuation
research.nava.capital/market-valuati…
@albertedwards99 @mjmauboussin @MebFaber @johnauthers @INArteCarloDoss @jposhaughnessy @FTAlphaville @TheStalwart @BittelJulien @C_Barraud @VolatilityQ
research.nava.capital/market-valuati…
@albertedwards99 @mjmauboussin @MebFaber @johnauthers @INArteCarloDoss @jposhaughnessy @FTAlphaville @TheStalwart @BittelJulien @C_Barraud @VolatilityQ
2 Our goal is to show, as objectively as possible, the discrepancy between the intrinsic and the current value of the S&P 500 and what it implies for future returns.
@jessefelder @LeutholdGroup @HorizonKinetics @Not_Jim_Cramer @patrick_oshag @5thrule @MacroCharts @macro_srsv
@jessefelder @LeutholdGroup @HorizonKinetics @Not_Jim_Cramer @patrick_oshag @5thrule @MacroCharts @macro_srsv
3 Our conclusion is that the S&P 500 is not likely to have a positive nominal total return in the next 10 years and a ‘miracle’ would be needed to achieve positive real total returns.
@CliffordAsness @RA_Insights @GestaltU @choffstein @hblodget @hkuppy @42macroDDale @verdadcap
@CliffordAsness @RA_Insights @GestaltU @choffstein @hblodget @hkuppy @42macroDDale @verdadcap
Market participants are going ga-ga over past one & half year returns since March 2020 till now. They are analysing returns in Bits & Pieces.
I do not think many have even participated in this rally as most exited in March 2020, waiting for further corrections
I do not think many have even participated in this rally as most exited in March 2020, waiting for further corrections
They are conveniently forgetting recent past corrections and drawdown.
Lower the drawdown, faster the bounce backs
Lower the drawdown, faster the bounce backs
Ideal way to look at returns is as a continuous journey. That can give true picture of what Investors would have generated in any scheme.
In spite of euphoria - look at NIFTY Small or Mid Cap 100 returns from 01-01-2018 till 27-09-2021 + attached volatility v/s other DAAFs
In spite of euphoria - look at NIFTY Small or Mid Cap 100 returns from 01-01-2018 till 27-09-2021 + attached volatility v/s other DAAFs
My thoughts on NFO of @KotakMF Multi Cap Scheme:
Post recategorizations of schemes, most erstwhile Multi Cap Schemes were converted to Flexi Cap schemes where Fund Managers can decide what Allocation to which Market cap bias.
bit.ly/3BCX9mW
@NileshShah68
Post recategorizations of schemes, most erstwhile Multi Cap Schemes were converted to Flexi Cap schemes where Fund Managers can decide what Allocation to which Market cap bias.
bit.ly/3BCX9mW
@NileshShah68
Thanks to that, there are very few Multi Caps available now which allocates min 25% each to Large, Mid and Small Caps and balance 25% that can be at the discretion of the Fund Manager.
What is the benefit of Multi Caps?
1. It takes away Fund Manager bias of going overweight or underweight in any market Cap bias
2. Most Flexi Caps are overweight on Large Caps
1. It takes away Fund Manager bias of going overweight or underweight in any market Cap bias
2. Most Flexi Caps are overweight on Large Caps
My interview with @MubinaKapasi on the Money Show on @ETNOWlive : what is #AssetAllocation and how does #DAAF fit into AA:
Currently it makes sense to do SIP/STP into DAAF and then switch to Equity on corrections
Don't worry it is my interview only😀😉
Currently it makes sense to do SIP/STP into DAAF and then switch to Equity on corrections
Don't worry it is my interview only😀😉
At this juncture if you have FOMO, you may regret in future. As Harry Markowitz said in his Thesis on Risk-Reward Tradeoff:
VISUALISED MY GRIEF WHEN MARKETS WENT DOWN AND I WAS 100% IN IT OR WHEN MARKETS WENT UP, I WAS'T IN IT. INTENTION SHOULD BE TO MINIMISE FUTURE REGRET
VISUALISED MY GRIEF WHEN MARKETS WENT DOWN AND I WAS 100% IN IT OR WHEN MARKETS WENT UP, I WAS'T IN IT. INTENTION SHOULD BE TO MINIMISE FUTURE REGRET
Our Value STP follows 1X, 3X, 100X formula:
Lumpsum in Liquid/Equity Saving and switch into:
1X - in DAAF in Red Zone (current)
3X - in Equity in Yellow Zone
100X - Equity in Green Zone
Lumpsum in Liquid/Equity Saving and switch into:
1X - in DAAF in Red Zone (current)
3X - in Equity in Yellow Zone
100X - Equity in Green Zone
Many have asked me about spate of IPOs and NFOs launches and my thoughts. Should they invest or not?
Another question: why are AMCs launching NFOs at expensive valuations?
My thoughts on this subject:
Another question: why are AMCs launching NFOs at expensive valuations?
My thoughts on this subject:
If you had bought 5kg of sugar from a grocer & you order another 2kgs next day, will the grocer not sell you more? They are in the business of selling you day to day groceries.
What and how much you need is your choice as a customer. You cannot blame the grocer for selling
What and how much you need is your choice as a customer. You cannot blame the grocer for selling
Put differently:
Which medicine(scheme) needed for which patient(Investor) is job of a Doctor(MFD) or patient(DIY Investor). It is not job of Pharma Companies(AMCs).
Just because Pharma Cos repackage the medicines, does not mean patients should increase their dose
Which medicine(scheme) needed for which patient(Investor) is job of a Doctor(MFD) or patient(DIY Investor). It is not job of Pharma Companies(AMCs).
Just because Pharma Cos repackage the medicines, does not mean patients should increase their dose
Infrastructure Investment Trusts (InvITs)
InvITs are infrastructure developer-sponsored trusts that own, operate, and invest in completed/under-construction projects which entitle the unit holder to receive a share of the income generated by the InvIT from its assets.
(Thread)
InvITs are infrastructure developer-sponsored trusts that own, operate, and invest in completed/under-construction projects which entitle the unit holder to receive a share of the income generated by the InvIT from its assets.
(Thread)
1/What are these Infrastructure Assets?
These can be roads and highways, power distribution networks, telecom towers, fiber optic networks, etc.
𝑵𝒐𝒘, Let's say we have an infra company that specializes in constructing roads & highways on a Build-Operate-Transfer (BOT) basis,
These can be roads and highways, power distribution networks, telecom towers, fiber optic networks, etc.
𝑵𝒐𝒘, Let's say we have an infra company that specializes in constructing roads & highways on a Build-Operate-Transfer (BOT) basis,
2/ means company will build roads, operate for a period of time (collect toll as income) & on completion of tenure, will transfer to govt.
If co. needs funds for construction, it will have to raise either by selling shares (equity), taking a loan (debt) or it can opt for an InvIT
If co. needs funds for construction, it will have to raise either by selling shares (equity), taking a loan (debt) or it can opt for an InvIT
Asset allocation refers to an investment strategy in which individuals divide their investment portfolios between different diverse asset classes to minimize investment risks.
There is no simple formula that can find the right asset allocation for every individual.
(thread)
There is no simple formula that can find the right asset allocation for every individual.
(thread)
1/ An Portfolio Distribution is influenced by factors such as personal goals, level of risk tolerance and investment horizon.
As there are multiple options for investment, on the basis of risk, can be classified into 3 categories, "High Risk", "Medium Risk" & "Low Risk".
As there are multiple options for investment, on the basis of risk, can be classified into 3 categories, "High Risk", "Medium Risk" & "Low Risk".
2/ "With great risk, comes great reward." - Thomas Jefferson.
But remember "For a low return on investment, the risks are also relatively low."
But remember "For a low return on investment, the risks are also relatively low."
1/10
We all wish to be #FI
Investing sensibly is the only way to achieve this.
Hence #AssetAllocation becomes important , as we need to, BOTH PROTECT & GROW OUR CAPITAL to meet our goals in life.
A basic thread in simple language for beginners.
If useful , pls do share 😇🙏
We all wish to be #FI
Investing sensibly is the only way to achieve this.
Hence #AssetAllocation becomes important , as we need to, BOTH PROTECT & GROW OUR CAPITAL to meet our goals in life.
A basic thread in simple language for beginners.
If useful , pls do share 😇🙏
2/10
Asset Allocation is an Investment Portfolio technique .
It aims to mitigate the risk by distributing our investable surplus across different asset classes like Equity, Debt, Gold, Real Estate, MF, Cash or Alternates after Risk Profiling of the investor.
An example 👇
Asset Allocation is an Investment Portfolio technique .
It aims to mitigate the risk by distributing our investable surplus across different asset classes like Equity, Debt, Gold, Real Estate, MF, Cash or Alternates after Risk Profiling of the investor.
An example 👇
3/10
ITS NECESSITY
Every Asset class has its risks & it's impossible to predict which would fetch the best possible returns.
Imagine if one had invested only in Equities in 2007/ 2019 or in Real Estate at its peak in 2011 with a hefty loan with no shock absorber in place ! 🤷
ITS NECESSITY
Every Asset class has its risks & it's impossible to predict which would fetch the best possible returns.
Imagine if one had invested only in Equities in 2007/ 2019 or in Real Estate at its peak in 2011 with a hefty loan with no shock absorber in place ! 🤷
US tech stocks have been hit hard, as attention focuses on the underlying quality of themes like the migration to electric vehicles.
Yet this shakeup is also happening against the backdrop of a fast-changing investment environment due to a strengthening US growth outlook, rising inflationary pressure and an unnerved bond market which is driving yields higher.
In this video interview, Will Denyer seeks to unpack these dynamics in order to navigate a course through difficult trading conditions. vimeo.com/521265797 #assetallocation #equities #us #stocks #bonds #economy
