The following are iCIO Summit presentations by Mark Yusko, founder of Morgan Creek Capital Management and John Mauldin, the best-selling author of several financial books.
Below is an excerpt from Mark Yusko’s presentation:
S&P vs. 10 Yr. Bond Spread Favors Bonds for 2014
Continued from part one... Q1 hedge fund letters, conference, scoops etc Abrams and his team want to understand the fundamental economics of every opportunity because, "It is easy to tell what has been, and it is easy to tell what is today, but the biggest deal for the investor is to . . . SORRY! Read More
When it comes to portfolio construction the above 2 pack reflects that when the spread is wide, it has paid to overweight towards stocks and underweight bonds. When the spread is narrow it has paid to overweight towards bonds and underweight stocks. The current spread is the narrowest since 2000 & 2007. Is history a good guide here? Or has the Fed goofed this spread idea up for good?
World Has Changed, Investment Model Must Change
The structural backdrop for a Global Tactical Allocation Strategy
- Developed economy governments are insolvent
- The process of deleveraging and global rebalancing is underway
- Outsized dislocations from “non-economic” policy actions
- The loss of central bank independence with likely unintended consequences
- Ongoing battle between deflation and reflationary forces
- Shorter and more volatile economy cycles that are globally synchronized
- Drop of confidence in policymakers, institutions and the “system” at large
- Increased risk of geopolitical tensions and social conflict
- Market prices only reflect fair value by accident and in passing
World Has Changed, Investment Model Must Change Source(s): TGSF Advisors. Investment Model must be more TACTICAL and be implemented DIRECTLY in order to capitalize on opportunities that occur within the shorter cycles.