Excess Returns Show Us of Your Portfolio II: Larry Swedroe on Alternatives and Interval Funds
15 snips
Dec 21, 2023 
Larry Swedroe, head of financial research at Buckingham Strategic Wealth and author of multiple investing books, delves into the intricacies of alternative investing. He discusses the unique risks of illiquid assets and how they enhance portfolio optimization. Listeners learn about the advantages of interval funds, reinsurance, and managed futures, as well as the importance of diversification beyond traditional stocks and bonds. Swedroe emphasizes a disciplined, evidence-based approach to investment strategies, helping investors navigate today's complex market landscape.
AI Snips
Chapters
Books
Transcript
Episode notes
Separate Public And Private Asset Valuations
- Public and private versions of equities and fixed income behave differently and must be treated separately when forecasting returns.
- Private assets can offer different risk-return dynamics than public markets, so classify them accordingly.
Favor Systematic, Transparent, Replicable Strategies
- Use systematic, transparent, and replicable strategies as the default for building portfolios.
- Avoid opaque active bets unless you can justify them with evidence and low fees.
Liquidity And Tail Risk Change Compensation
- Risk-adjusted returns should be similar across assets, but liquidity and tail risks change compensation.
- Investors who don't need liquidity can earn an illiquidity premium by holding less liquid assets.
