General Research

Over the last several decades, the debate around active versus passive investment strategies has consumed countless hours of investment professional time, involved endless analyses of troves of historical data, and, ultimately, led to untold gallons of ink spilled in articles and books. For some investors, undo focus on hiring and firing active managers in pursuit of elusive “alpha” has kept them from paying attention to the more important, higher impact components of investment program structure.

Risk Parity is a simple idea: maximize diversification by taking equal risk in each investment.

This paper is an example of NEPC’s approach to opportunistic investing, where we seek to identify occasional major market valuation extremes and recommend actions for clients over a medium-term horizon.

The typical defined contribution program offers twenty to twenty-five investment choices, if target date funds are counted individually. One or two of those choices will be a capital preservation fund, such as a money market fund or a stable value fund. These funds have a primary objective of providing current income while protecting principal. The risk/return profile can be thought of as modest return with very low risk.

This paper discusses what we deem to be the key determinants of Mr. Buffett’s success.  Additionally, we explain why these attributes are not widely emulated within the    investment management industry. 

Investment management is a judgment-rich endeavor.  The major components of managing an investment program – determining objectives, finding and exploiting opportunities, and evaluating the extent to which objectives have been achieved – all involve judgment as much as data.  Judgments in turn are framed by one's system of beliefs about how the investment world works.  Given this, it seems worthwhile to ponder where our beliefs come from, to assess their validity, and to attempt to improve them as opportunities exist to do so.

This paper is geared toward generating a conversation across our client base about mapping fund replacements to the QDIA as a preferred approach.

This paper gives an overview of the final regulation clarifying the types of investments that qualify as a “qualified default investment alternative” (QDIA).