Items related to The Little Book of Alternative Investments: Reaping...
BRAND NEW, perfect condition.
"synopsis" may belong to another edition of this title.
Review:
The authors give an uncommonly clear account of the desirable alternatives, especially hedge funds. This is a great little book for investors who are trying to improve their asset allocation. Lots of meat and fun to read.
Seeking Alpha
From the Author:
Seeking Alpha
Q&A with Ben Stein
The book discusses the 60/40 portfolio--what are the good and bad sides of it?
A. The 60/40 stock/bond portfolio has evolved by natural selection to be the default preference for many investors. Since 1976 it has offered about 93 percent of the returns of the entire stock market with only about 65% of the risk. That's a pretty good trade-off. On the other hand, the vast majority of the risk comes from the stock side. It is basically riding the stock market with a shock-absorber from the bonds. This is the impetus to our search for alternatives--the desire to spread our risks so we don't get jerked around as much.
Why do you say in the book “Luck is a terrible strategy” ?
If you scratch the surface, most investors are terrified. They know the pain of losing money, yet they have to do something with their savings, so they are led by the financial services industry to throw it at whatever has done well lately and then cross their fingers. Wall Street's basic strategy is to post impressive performance numbers by taking on added risks that are not visible until it is too late. This is what lures the suckers into the tent. It works most of the time, because most of the time the market is up. When it collapses, if investors move at all, it is simply to the next guy with a great recent track record. This is not a profitable way to invest.
Why you are against gold (i.e. if you are a king or pirate, you need a chest of gold. If not, you don’t)
Most assets are supported by underlying earning power. Gold is supported by other people's fascination with gold. This is a circular argument. Gold is extremely difficult to value rationally, which means that its price is wildly susceptible to fanaticism and gold metaphysics. By definition, most people will get most interested precisely when the price is highest and the expected future returns are lowest. That said, we do believe that a small allocation to a broad basket of commodities (including precious metals) can be a useful portfolio diversifier.
Why are hedge funds the ultimate alternative investment?
Hedge funds are the ultimate alternative investment because they set out to be. They set out to 'hedge" or bet against whatever is the prevailing wisdom or trend. Their whole purpose is to go against whatever the general market feeling is: so, if people are loading up on crude oil, they sell crude; if people are going long on real estate, they go short on real estate. If the market generally is optimistic, they short the market. That is at least what hedge funds are supposed to be. Some are really just managed investment pools, but their goal is to be contrary.
The book discusses the 60/40 portfolio--what are the good and bad sides of it?
A. The 60/40 stock/bond portfolio has evolved by natural selection to be the default preference for many investors. Since 1976 it has offered about 93 percent of the returns of the entire stock market with only about 65% of the risk. That's a pretty good trade-off. On the other hand, the vast majority of the risk comes from the stock side. It is basically riding the stock market with a shock-absorber from the bonds. This is the impetus to our search for alternatives--the desire to spread our risks so we don't get jerked around as much.
Why do you say in the book “Luck is a terrible strategy” ?
If you scratch the surface, most investors are terrified. They know the pain of losing money, yet they have to do something with their savings, so they are led by the financial services industry to throw it at whatever has done well lately and then cross their fingers. Wall Street's basic strategy is to post impressive performance numbers by taking on added risks that are not visible until it is too late. This is what lures the suckers into the tent. It works most of the time, because most of the time the market is up. When it collapses, if investors move at all, it is simply to the next guy with a great recent track record. This is not a profitable way to invest.
Why you are against gold (i.e. if you are a king or pirate, you need a chest of gold. If not, you don’t)
Most assets are supported by underlying earning power. Gold is supported by other people's fascination with gold. This is a circular argument. Gold is extremely difficult to value rationally, which means that its price is wildly susceptible to fanaticism and gold metaphysics. By definition, most people will get most interested precisely when the price is highest and the expected future returns are lowest. That said, we do believe that a small allocation to a broad basket of commodities (including precious metals) can be a useful portfolio diversifier.
Why are hedge funds the ultimate alternative investment?
Hedge funds are the ultimate alternative investment because they set out to be. They set out to 'hedge" or bet against whatever is the prevailing wisdom or trend. Their whole purpose is to go against whatever the general market feeling is: so, if people are loading up on crude oil, they sell crude; if people are going long on real estate, they go short on real estate. If the market generally is optimistic, they short the market. That is at least what hedge funds are supposed to be. Some are really just managed investment pools, but their goal is to be contrary.
"About this title" may belong to another edition of this title.
- PublisherWiley india Pvt. Ltd
- ISBN 10 8126561505
- ISBN 13 9788126561506
- BindingPaperback
- Number of pages288
- Rating
(No Available Copies)
Search Books: Create a WantIf you know the book but cannot find it on AbeBooks, we can automatically search for it on your behalf as new inventory is added. If it is added to AbeBooks by one of our member booksellers, we will notify you!
Create a Want