Adaptive Asset Allocation: Dynamic Global Portfolios to Profit in Good Times - And Bad

by Adam Butler, Michael Philbrick, Rodrigo Gordillo

Build an agile, responsive portfolio with a new approach to global asset allocation Adaptive Asset Allocation is a no-nonsense how-to guide for dynamic portfolio management. Written by the team behind Gestaltu.com, this book walks you through a uniquely objective and unbiased investment philosophy and provides clear guidelines for execution. From foundational concepts and timing to forecasting and portfolio optimization, this book shares insightful perspective on portfolio adaptation that can improve any investment strategy. Accessible explanations of both classical and contemporary research support the methodologies presented, bolstered by the authors' own capstone case study showing the direct impact of this approach on the individual investor.Financial advisors are competing in an increasingly commoditized environment, with the added burden of two substantial bear markets in the last 15 years. This book presents a framework that addresses the major challenges both advisors and investors face, emphasizing the importance of an agile, globally-diversified portfolio.Drill down to the most important concepts in wealth management Optimize portfolio performance with careful timing of savings and withdrawals Forecast returns 80% more accurately than assuming long-term averages Adopt an investment framework for stability, growth, and maximum income An optimized portfolio must be structured in a way that allows quick response to changes in asset class risks and relationships, and the flexibility to continually adapt to market changes. To execute such an ambitious strategy, it is essential to have a strong grasp of foundational wealth management concepts, a reliable system of forecasting, and a clear understanding of the merits of individual investment methods. Adaptive Asset Allocation provides critical background information alongside a streamlined framework for improving portfolio performance.

Genres: Finance

240 pages, Kindle Edition

First published January 19, 2016

Reviews

[Jack Maguire · Rating 4 out of 5]

Adaptive Asset Allocation offers a useful introduction to risk-focused investment management, though it loses some accessibility once it delves into the weeds of portfolio optimization. The book lays out an approach to constructing an agile, diversified portfolio attuned to shifting global economic regimes. The authors make a strong case for moving beyond basic stock/bond allocations and broad index funds to incorporate volatility management and macroeconomic dynamics.

The book particularly shines in elucidating theories of risk reduction for retirees drawing down assets. It highlights the shortcomings of long-term return averages, factoring in withdrawal sequence risk. These insights help investors think more adaptively about asset allocation aligned to personal time horizons. However, the book does get fairly technical in later chapters on forecasting and portfolio construction. The level of detail is likely better suited to wealthy investors nearing retirement than general audiences.

That said, Adaptive Asset Allocation succeeds in questioning passive investing orthodoxy, opening readers to new perspectives. It is well-researched and clearly written, backing up its methodology with ample data. While the book loses some focus in the intricacies of portfolio optimization, it nonetheless proves thought-provoking for anyone seeking a deeper understanding of managing volatility. Although not an easy cover-to-cover read, it offers useful principles for developing a more adaptive investment framework.

[Aajay Beell]

Focused on just 2 critical tenets that , when taken together , represent the most important concepts in Wealth Management
1. Risk is measured as the probability that you wont meet your Financial Goal
2. Investing should have the exclusive objective of minimizing the risk


This book make me aware of few simple and powerful thoughts and bring clarity about Why Asset Allocation and Re allocation make sense .