Lower interest rates are increasing near-term returns. But this should not cloud our judgment that, to some extent, it is coming at the expense of future returns. In trying to address the issue of investing in a world of lower interest rates, we need to adapt our investing methods and approach – which we have done in recommending and constructing [...]
The best way of protecting against inflation, we believe, is to invest in assets. Such a strategy particularly pertains to wealthy individuals, since rising asset prices may influence inflation perceptions more than the prices of other goods included in economists’ inflation baskets. Equities, which represent claims on the future income produced by the real assets of a business, should rise [...]
Outside of credit, another potential area to consider for investors looking for investments with a reasonable return outlook and relatively low volatility is hedge funds. Often discredited for being illiquid, opaque, and expensive, hedge funds can serve as an effective portfolio diversifier for investors with limited cash flow requirements. And with markets normalizing, correlations falling, and valuation dispersion still relatively [...]
To be active in foreign currencies and to even take speculative long or short positions in the USD is especially difficult for US persons with bank accounts in the USA. This is one of the reasons why Dara developed investment advisory solutions which involve bank accounts in Switzerland. Using the Swiss banking platform is convenient and cost efficient for the [...]
Over the past years, we have developed a tool to stress test portfolios and to graphically display factor risks embedded in a given asset allocation. The amount of stress to a portfolio can be varied given a client’s personal outlook or based on a historic event.