Tristan joined M&G in 2016 as a fund manager and is a member of the Multi Asset team, with over 15 years’ experience in asset management. Prior to joining M&G, he was Head of Asset Allocation with responsibility for global multi-asset funds at Ashburton Investments. Tristan holds a Master in Public Administration in International Development from Harvard University’s Kennedy School of Government and a BA (Hons) in Economics from Durham University. He is a Chartered Fellow of the CISI.
Beware the allure of a good-looking chart
I received the following chart from a broker earlier this week. It plots the trailing 12-month price return on the US stock market versus a survey of activity in the US manufacturing sector, where a score above 50 indicates expansion and vice versa.
The broker’s conclusion was straight-forward, “if you… Read the article
From rationality to realism. Book review: “A Crisis of Beliefs: Investor Psychology & Financial Fragility”
Behavioural Finance
“The world…has witnessed an extensive history of financial bubbles, expanding credit, and subsequent crises…We put inaccurate beliefs at the centre of the analysis of financial fragility”.
In a new book, “A Crisis of Beliefs”, economists Nicola Gennaioli and Andrei Shleifer tackle the role of beliefs in financial… Read the article
Science & pseudoscience of quantitative techniques
Behavioural Finance Economics
Eric recently wrote a fascinating piece on the ‘volatility virus’ which has contaminated the professional investment community. This blog post builds on that piece by considering the use – more specifically, the misuse – of quantitative ‘analysis’ more generally.
It is important to point out I am not… Read the article
US Yield Curve: Inverted Logic?
Economics
Fed officials have been particularly vocal about the slope of the yield curve this week (most notably here and here), in particular voicing concerns over a possible curve inversion (when yields on short dated bonds rise above those on long dated bonds).
The obsession… Read the article
US yield curve flattening: nothing to see here
Economics Markets
The flattening of the US yield curve has inspired much commentary and hand-wringing in certain quarters lately. The concern is overdone.
Looking back at periods of rising US policy rates over the past 30 years, history would suggest there is nothing remarkable about today’s level of long-dated bond yields relative… Read the article
Thinking (and feeling) about risks
Behavioural Finance
New York, New York…
Imagine the excitement. In a moment of spontaneity, you’ve decided to treat yourself and your other half to a last minute trip to New York. You’ve selected the hotel, managed to get reservations at some highly recommended restaurants and even tickets for a Broadway show, which… Read the article
US households: rarely had it so good?
Economics
With Korean missile launches, Trump’s tweets, Hurricane Harvey, NAFTA negotiations and Brexit battles, journalists have plenty to keep themselves busy.
Of course, some of today’s headline-grabbing events might bring profound and unexpected change with lasting impact on global financial markets. But then again, they may not: devastating local events such… Read the article
Going with the flow?
Investment Industry Markets
A lot of time collectively is spent monitoring and analysing data on investment fund flows. Is this time well spent?
The assumptions typically made are that fund flows data indicate which assets are ‘popular’ and in the absence of significant change, continued flows might suggest underlying momentum for an asset… Read the article
Backward looking forecasts
Behavioural Finance Economics
We have long written about the dangers of economic forecasting as an input into the investment process. The future is often highly surprising and nobody has a perfect model of how the economy works, which means forecasts will usually turn out to be wrong – just ask any… Read the article
US and global inflation: A cyclical turn or something more lasting?
Economics Markets
Though they might not admit it now, a number of commentators argued in the immediate post-crisis years that quantitative easing (QE) would cause inflation to rise to worrying levels in countries such as the US and UK.
At the time, I argued this view was likely to be wrong because… Read the article