How well have active managers performed compared to their passive counterparts through COVID-19? And what does this mean for the future of active? Find out in our white paper from new Head of Market of Intelligence, Jeffrey Corrado, Founder Sean Kruzel, and entrepreneur Evan Schnidman, Ph.D.
Driven by FOMO, investors cope with conflicting signals from governments and markets and attempt to simplify the complex, but better outcomes are elusive.
The market has mysteriously rebounded even as attention shifts to a potential second wave. But as brick-and-mortar reacts to the risk—Apple is re-closing stores, for example—a pause in momentum seems inevitable. Fed support, the centerpiece of the economic playbook, has steered the economy away from a worst-case scenario so far. The market has stood tall in backstopping risk assets as the Fed shoulder surfs behind.
Investment selection remains critical as certain leaders and market segments earn rewards over others. Advisors focus on a return to normalcy as they assess the impacts of social distancing by studying the behaviors and flows of people. The diversification narrative rises in urgency and will be redefined with different time horizons and greater data analysis through tools.
Advisors are looking deeply at the embedded risks within their strategic model portfolios. For example, exposure to China has recently rewarded investors due to the growth outlook, yet the political risk of US-China tensions tip the risk/reward ratio in this scenario.
Despite the unfolding global pandemic and unusual market volatility, our fund selections continue to perform well through this next stage of COVID recovery.
What We’re Reading
Check out what our team’s been reading this week:
- Why Active Management Still Has an Edge over Passive Investing – FA article on why active managemnet inmeerging markets has a distinct edge over their passive counterparts.
- OCIO Firms Faltered in the First Quarter But Institutions Still Want to Outsource Investments– An important article in Institutional Investor updating on OCIO activity with rebalancing as a possible cause of underperformance yet the outsourcing future is bright.
- MAMU: Mother of all Meltups – A blog post with graphics from market strategist Yardent on the debate of meltup vs bear market.
- Why the Widening Wealth Gap is Bad for Everyone – Barron’s article addressing long-term concerns with wealth inequality derived from the recent investor holdings’ data.
- Technology – Ignorance Will Hurt Under New CFP Standards – An article describing the challenge for advisors to be aware of scenarios assumptions built into tech apps with recent CFP updates.
- ETFs Overshadow Client Alignment – Blog post on ETF.com detailing how the recent ETF activity is misaligned with today’s investors needs for targeted alpha.
- Lessons from the Brink – How $4B in ETFs Bounced Back – Bloomberg article describes the lessons learned from the Fed buying ETFs and how it has modified investor behavior.
- Disease and Debt Now, Dispersion Later ? – Article penned by Franklin Templeton team on the risk of loading up the national debt and the potential downstream impact.
Our Top Posts
Check out our own top posts:
- [White Paper] Active Management is in Trouble (Again)
- Portformer™ Performance During Market Correction
- Coronavirus Twitter Influencer Analysis
- Tactical Alert: Adjusting to ETF-ETP Fund Closures
Connect with Us
Hop on a quick, scheduled 15 min Zoom call with us and explore some new ideas about how to engage your clients and families.
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Happy Father’s Day !
All the best,
John DiBenedetto and the Portformer™ Team