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Darst, David M.. Mastering the Art of Asset Allocation: Comprehensive Approaches to Managing Risk and Optimizing Returns. US: McGraw-Hill Education, 2007.

Mastering the Art of Asset Allocation: Comprehensive Approaches to Managing Risk and Optimizing Returns

Authors: David M. Darst

Published:  2007

ISBN: 9780071719537 0071719539
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  • Contents
  • Foreword
  • Preface
  • Section 1 Asset Allocation Insights
  • Chapter 1 Essentials of Asset Allocation Mastery
  • Overview
  • Meanings and Elements of Mastery
  • Foundations of Mastery
  • Advantages and Drawbacks of Mastery
  • Investing Perspectives on Alternative Investments
  • Investing in an Environment Subject to Crises and Global Asset Market Dislocations
  • Chapter 2 Asset Allocation and Investment Lessons from University Endowments
  • Overview
  • Special Features of College and University Endowments
  • Applications of Successful Endowments’ Experiences to Other Investors
  • Important Distinctions between Endowments and Other Investors
  • Similarities in Approach by Harvard and Yale University Endowments
  • Harvard University
  • Yale University
  • Section 2 Underpinnings of Asset Allocation
  • Chapter 3 Applications and Implications of Compound Interest
  • Overview
  • Selected Insights into Compound Interest
  • Returns in the Form of Income versus Capital Gains
  • Periodic Contributions and Periodic Withdrawals
  • Spending versus Reinvesting Income Flows
  • Coupon Reinvestment in Fixed-Income Securities
  • Dividend Reinvestment in Equities
  • Multiyear Rates of Return
  • Section 3 Asset Class Attributes
  • Chapter 4 Multiyear Investment Performance of Selected Asset Classes
  • Overview
  • Investment Performance Parameters
  • Multiyear Investment Performance Data
  • Caveats in Multiyear Investment Performance Analysis
  • Observations on Asset Classes’ Investment Performance
  • Chapter 5 Understanding and Using Correlations
  • Overview
  • Definitions of Correlation
  • Development of the Correlation Measure
  • R-Squared Measure, or Coefficient of Determination
  • Caveats to Correlations
  • Correlation and Causation
  • Absolute and Relative Values of Correlation
  • Selected Types of Correlation Coefficients
  • The Effects of Correlations on Portfolio Investment Performance
  • Correlations as a Determinant of Portfolio Investment Performance
  • Correlations Dynamics in Multiasset Portfolios
  • Serial Correlations
  • How Correlations Work in Mean-Variance Optimization Models
  • Chapter 6 Correlations of Returns between Asset Classes
  • Overview
  • Summary of 10-Year Overlapping Correlations
  • Historical Perspective on 10-Year Overlapping Correlations between Equity Asset Classes
  • Summary of Historical Perspective on 10-Year Overlapping Correlations between Fixed-Income Asset Classes
  • Summary of Historical Perspective on 10-Year Overlapping Correlations between Alternative Investments Asset Classes
  • Rolling 10-Year Correlations of Annual Returns
  • Overview—Three-Year Nonoverlapping Correlations
  • Summary of Historical Perspective on Correlations between Asset Classes—Equity
  • Summary of Historical Perspective on Correlations between Asset Classes—Fixed-Income Securities
  • Summary of Historical Perspective on Correlations between Asset Classes—Alternative Investments
  • Nonoverlapping Three-Year Correlations of Monthly Returns
  • Section 4 Financial Markets Analysis and Investment Insights
  • Chapter 7 Recognizing Cyclical and Secular Turning Points
  • Overview
  • Turning Points in an Asset Allocation Context
  • Cyclical Analysis versus Secular Analysis
  • Excesses That Potentially Indicate Turning Points
  • Fundamental Excesses That Potentially Indicate Turning Points
  • Valuation Forces
  • Psychological, Technical, and Liquidity Forces
  • Asset Bubble Phenomena
  • Section 5 Implementation Tactics and Strategies
  • Chapter 8 Structural Considerations in Asset Allocation
  • Overview
  • Structural Considerations
  • Financial Planning
  • Personal Trusts
  • Life Insurance and Annuities
  • Tax Management
  • Liability Management
  • Section 6 Information Sources
  • Chapter 9 Information Management
  • Overview
  • Classifying Information Sources
  • Strategies and Tactics for Information Management
  • Information-Management Caveats
  • Internet-Based Information Sources
  • Optimizing Internet-Based Information Sources
  • Chapter 10 Sources of Information
  • Media-Based Information Sources
  • Conferences, Seminars, and Workshops
  • Corporations and Individual Investor Organizations
  • Educational Institutions and Research Institutes
  • Governmental and Regulatory Bodies
  • Nonprint Mass Media
  • Periodicals, Newspapers, and Newsletters
  • Subject-Based Information Sources
  • Index