You could be leaving money on the table….
In this article, the 4th in the in the “OpinionaTech” leadership series by the LENSELL team, a novel hypothesis is launched that may be challenging for many investors and investment managers.
The article shows that regular optimisation of the asset allocation in an investment portfolio produces better returns long term compared with the ‘regular rebalancing to the original weights’ approach. Even more interestingly, in some cases (like the test one) the regular rebalancing to original weights could be overtaken by a “buy and hold” approach.
That proves that blanket investment strategies do not work – to get better returns, investment managers need to consider individual portfolio compositions and how those can be optimised for investors’ benefit.
Further research is in progress, but you can read the article and check the preliminary results.
Check out the previous articles in this series:
Episode 1 – To risk or not to risk – a conflict of (investing) emotions.
Episode 2 – What’s driving investors, mind or emotions?
Episode 3 – Is high level portfolio diversification enough?
Contact the team with any questions at: [email protected] or [email protected].
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