These Threats Can Wreak Havoc on Your Retirement Plans

You've heard it before: Save, invest and repeat. But even if you do everything right, unexpected hurdles can still arise to threaten your financial security.

In a country facing a retirement-savings deficit of up to $14 trillion, Americans can't afford to ignore any factor that could set back their financial plans. While no one can predict the future, I personally can offer a few words of wisdom around how to start planning today. And that means making concessions for the scenarios that are most likely to compromise decades of thoughtful saving.

Here are seven threats that can eat up your nest egg.

1. Not saving early enough. Pushing off saving for retirement is the biggest threat to maintaining your existing standard of living in the future. The sooner you invest in yourself, the more you'll earn in compounded interest.

For example, saving $17,000 every year starting at age 25. Assuming a 7 percent return, you'll have about $3.4 million at age 65.

If you wait until you're 40 to save, the final amount tanks to $1.1 million. 

2. Paying high fees. Most people don't know how much they're paying in fees each year, and, over time investors can lose hundreds of thousands of dollars.

The most common types of fees include expense ratio, as with mutual funds and exchange-traded funds; plan fees, advisory and management fees (going to financial advisors); and transaction fees (i.e, buying or selling). Not all fees are easily understood, and many are embedded deep within investment products.

"You may think that shifting your investments around frequently will help accelerate the process, but buying and selling too often only hurts your retirement savings."

Have a conversation with your provider to understand where your money is going and eliminate any unnecessary costs.

3. Unexpected job loss. Stable income is essential for retirement saving, but unexpected job loss can happen to anyone. If you've received a tax refund recently, start an emergency fund or replenish an existing one.

Rule of thumb? Save enough cash to cover up to six months' worth of living expenses. Emergency funds don't just cover job loss; they can be used for sudden illness or other emergencies, too.


4. Supporting boomerang kids. As you approach your 60s, you may feel close to retirement — but that doesn't mean your kids are. Unfortunately, many parents spend upward of $5,000 annually on a post-grad child. And those years add up.

You want to help your kids, but you need to keep your retirement needs at the forefront when deciding how long to support them. So determine how long your retirement can last, and identify how long you'll support your children.

It's important to agree on boundaries, not only to help them grow up but also to prepare them for their own retirement.

5. Long-term care expenses. According to the U.S. Department of Health and Human Services, 70 percent of people age 65 and older will need long-term care services at some point in their lives. Ever realized that a nursing-home stay costs more than $70,000 a year, on average, these days?

If paying for that could significantly dent your assets, you may want to think about insurance. Whether you're caring for a loved one or yourself, plan early to be prepared.

6. Aggressively managing assets. Any financial advisor will tell you that planning for the long term is important. You may think that shifting your investments around frequently will help accelerate the process, but buying and selling too often only hurts your retirement savings. Given low odds of outperformance for active funds, passive indexing is the more prudent approach.

7. Outliving your money. A recent survey found that 58 percent of affluent Americans would like to live to age 100, yet 41 percent of baby boomers expect their standard of living to decrease in retirement.

I'm not surprised by this at all. Always overestimate how much you'll need to save to maintain the standard of living you want, just in case.

The bottom line is that everyone should find what makes them happy and enjoy life. But it's essential to actively plan for retirement. If you're prepared to withstand realistic financial obstacles, you're on your way to enjoying those golden years to the fullest. -cnbc

Cash-flow Planning "Before" and "During" Retirement

How do you budget the wealth that you've amassed to help get you through retirement? When is enough really enough, and how are you going to spend it? Creating a proper financial plan before and during retirement is an important tool for all investors.

Let's break this down into two segments: planning before retirement and planning during retirement.

Planning before retirement

Budget. It is difficult, if not impossible, to start any financial plan without the B word: budget. Your budget is a necessary part to responsible cash-flow planning both before and during retirement.

Many people view budgeting as a negative or onerous process. However, it is crucial that analysis be done to determine how much cash is needed to maintain the lifestyle that you and your family have grown accustomed to living.

This will help you arrive at your Family Index Number, the long-term rate of return that your portfolio needs in order to pursue your desired standard of living.

You must treat your personal finances just like a business: A responsible business knows how much cash it is going to need to continue operating. What are the expenses going out the door, and how much money is coming in?

Once your budget is in place, it should be reviewed at least annually, if not monthly, to determine if additional funds are needed to continue your lifestyle or if adjustments should be made. A budget will also help to project long-term retirement savings needs.

Emergency fund. The fact of the matter is that through the course of your life prior to retirement, there will inevitably be a time for an emergency fund. The catalyst for that need may not be known, but it's good to have those funds set aside for whatever purpose that might be.

"The most important thing to keep in mind when planning for retirement — and preparing to spend your savings during retirement — is that your plan is a road map that you should put in place."

Your emergency fund should be set aside in the most risk-averse and liquid manner because, again, you never know the timing of the need for those funds.

The total amount needs to be decided by you and your family. Determining the amount needed is all about your comfort level. Some will say $5,000 or $10,000 is more than enough, while others will prefer to have a much higher amount at the ready for when they least expect it — but need it most.

Risk management. One area that is often overlooked or omitted in financial planning is risk management. So many people focus on saving as much money for retirement as possible, they completely forget the need to protect against potential risks.

Risk management runs the gamut from car insurance, homeowner's insurance, short-term and long-term disability, health insurance, long-term care insurance, life insurance and more. It is important these policies be considered for your risk-management portfolio, not treated as onetime decisions, and are part of an ongoing portfolio that needs to be monitored, reviewed and updated as needed.

Planning during retirement

Budget. During retirement, your plan should once again start with a budget. While the income needed to cover your expenses in retirement will most likely dramatically change, the important exercise of monitoring your cash-flow needs stays intact throughout retirement.

This goes well beyond the idea of just balancing a checkbook and reviewing budgeted expenses — it involves analyzing your recurring expenses throughout the year to identify places in which you might be able to find less-expensive options or plan for a major expenditure.

While budgeting often takes on a negative connotation, it can help you plan for a dream family vacation or determine how you are available to spoil children or grandchildren around the holidays.

Taxes. For most people during retirement, tax planning takes on a greater importance in terms of analyzing the sources of funds that you will use to maintain your lifestyle and their tax consequences.

In our current tax code, one type of account may have different tax consequences when funds are withdrawn than another. Retirement savings, or qualified accounts, are taxed at ordinary income levels, while nonqualified accounts are taxed at capital gains levels.

In some cases, this can represent a +/- 15 percent to 25 percent swing in tax liability. When specific funds are needed to maintain one's lifestyle in retirement, it is important to be mindful of the tax consequences of the accounts funding your retirement.

Taxes should not be the only consideration when making your financial plan, but it should be combined with other aspects of your overall financial picture. - cnbc

Invest Like a Professional

A layman typically invest in an ad hoc manner - without much forethought and planning. If a person has some surplus money to invest, he asks around and then usually puts his money in the product that is the fad of the moment or has offered high returns in the recent past. It may be equity at one point, and gold, real estate or some other asset class. If you invest based on past performance, achieving financial goals will be difficult. Random investments compromise goals - not help you fulfil them.

Prioritise goals

To achieve your goals, you first need to spell them out clearly and then prioritise them. For instance, retirement planning is an important goal, and so is children's education. Buying a car would be classified as a medium-priority goal while a foreign vacation would be a low- to medium-priority goal. Based on the resources available, allocate them to your high- and medium-priority goals first. Only if resources are left over should you allocate them to low-priority goals.

Understand cash flows

Identifying goals is only the first step. Before investing you need to evaluate your personal situation. Your age, number of years to retirement, marital status, financial commitments, background and lifestyle, occupation - all of it should all be taken into account when deciding which products to invest in. In fact, these play a crucial role even in identifying goals. A businessman, for example, can consider working well into his sixties and even seventies, as it is much more feasible for him to do so. Hence, in his case, it may be possible to accommodate a few interim goals, which may not be possible in the case of salaried. On the other hand, a service class person may have a regular cash flow and can invest regularly via systematic investment plan (SIP) to achieve his goals. Doing the same may not be feasible in the case of a businessman whose cash flows tend to be irregular. Also, the risk inherent in business is higher than in service. All these factors need to be taken into account when choosing the appropriate investments.

How much risk can you take?

Evaluating your capacity to bear risk should be your next step. A person's level of 'risk tolerance' provides a clue to the level of risky assets he may have in his portfolio. Risky assets include equity-oriented assets and real estate. Someone who is conservative should have a low level of allocation, say 35 per cent, to risky assets. Risk is measured in terms of the amount of volatility one can stomach without going ballistic. However, risk tolerance alone should not decide your asset allocation. Your personal situation should also play a major role. Professionals use validated psychometric tools for assessing risk. Many risk assessment tools are available on the Internet. You may make use of them to check out your risk appetite. Some of these tools also provide a comfort range within which one can operate for different asset classes, which is useful.

Besides risk tolerance, you also need to take into account your 'risk capacity'. For instance, a person with decades to retirement would have a higher risk capacity than a person close to retirement. For the former, a sudden reversal in the markets would not be catastrophic as he would have time on his side which will allow his investments to recover.

In a sense, this also tells you how much risk you may have to take to achieve a goal. This is referred to as 'risk required'. If risk required is very high for some goals, one may have to operate away from one's comfort zone, which is not desirable. Doing so will work only in cases where risk capacity is very high too.

Allocate right

Next, you can arrive at an asset allocation by taking into account your personal situation and the risk metrics discussed above. For near term goals of up to two years, safeguarding the principal is the primary concern. Only by investing in less volatile debt instruments can you ensure that the amount you need will be available when needed. For medium to long-term goals, adhere to an asset allocation approach.

Run a check to find out if a certain level of asset allocation is suitable for achieving the goals you have. You may adjust your exposure to risky assets slightly higher or lower to ensure that your goals are achieved. Such adjustment should, however, be within your comfort zone, as discussed earlier. One need not invest separately for different goals as long as the corpus grows at a pace where the goals are achieved as they come. As you approach a goal, move the amount allocated for that goal into debt based instruments in advance of the event. This will ensure that turbulence in the markets close to the goal does not jeopardise its achievement.

Choosing products

Finally, having ensured that you will be able to achieve your goals with the asset allocation you have arrived at, finalise the products you will invest in. While doing so, take into account various aspects such as liquidity, taxation, and tenure. The portfolio should be made in such a way that it is simple, easy to manage and at the same time efficient in meeting overall objectives.

This is how a professional goes about constructing a portfolio. He tries to understand his clients' goals, how far away they are, takes his risk tolerance and personal situation into account, and then arrives at an appropriate asset allocation. Only then does he choose the products that he should invest in. Once you follow the right method, it should not find it difficult to replicate these steps. -bs

Offshore Investments: Is It All That Evil?

Offshore investing has recently been demonised in the media, thanks to the release of the so-called Panama Papers. This case paints a picture of investors stashing their money with some illegal company located in an obscure location where the tax rate is next to nothing. While it’s true that there are some instances of shady offshore deals, the vast majority of offshore investing is perfectly legal and carried by law-abiding citizens. In fact, depending on your situation, offshore investing may offer you many advantages, and given that the majority of residents are expatriates, an offshore investment can be useful for many bona fide reasons.

What Is offshore investing?

Offshore investing refers to a wide range of investment strategies that capitalise on advantages offered outside of an investor’s home country. I will briefly touch on the advantages and disadvantages of investing internationally. There are no shortage of investments offered by reputable companies that are fiscally sound, tested and, most importantly, legal.

Advantages

Tax Reduction - Many countries offer tax incentives to foreign investors. The favourable tax rates in an offshore country are designed to promote a healthy investment environment that attracts outside wealth.

In recent years, however, many governments have become increasingly aware of the tax revenue lost to offshore investing, and has created more defined and restrictive laws that close tax loopholes. Investment revenue earned through offshore investment is now a focus of regulators and the tax man alike.

Asset protection

Offshore centres are popular locations for restructuring ownership of assets. Through trusts or an existing corporation, individual wealth ownership can be transferred from people to other legal entities. Many individuals who are concerned about lawsuits, or lenders foreclosing on outstanding debts elect to transfer a portion of their assets from their personal estates to an entity that holds it outside of their home country. By making these on-paper ownership transfers, individuals are no longer susceptible to seizure or other domestic troubles.

Confidentiality

Many offshore jurisdictions offer the benefit of secrecy legislation. These countries have enacted laws establishing strict corporate and banking confidentiality.

However, this secrecy doesn’t mean that offshore investors are criminals with something to hide. It’s also important to note that offshore laws will allow identity disclosure in clear instances of drug trafficking, money laundering or other illegal activities.

Diversification of Investment

In some countries, regulations restrict the international investment opportunities of citizens. Many investors feel that such restriction hinders the establishment of a truly diversified investment portfolio. Offshore accounts are much more flexible, giving investors’ unlimited access to international markets and to all major exchanges. On top of that, there are many opportunities in developing nations, especially in those that are beginning to privatise sectors that were formerly under government control.

Disadvantages

Tax Laws are Tightening — Due to political pressure, tax agencies are tightening up on many of the traditional tax efficiency-enhancing measures.

Cost

Offshore Accounts are not cheap to set up. Depending on the individual’s investment goals and the jurisdiction he or she chooses, an offshore corporation may need to be started. However, most offshore funds have similar charging structures to their onshore equivalent.

How safe is offshore investing?

Popular offshore countries are known to offer secure investment opportunities. More than half of the world’s assets and investments are held in offshore jurisdictions and many well-recognised companies have investment funds located in offshore locations. Like every investment you make, use common sense and choose a reputable investment firm. It is also a good idea to consult with an experienced and reputable advisor to get the best possible advice, especially if you are looking to protect your assets, or are concerned with estate planning or business succession. - gulfnews

Five Tips to Become a Better Investor

James Ashley, head of international market strategy at Goldman Sachs Asset Management explains how the techniques of behavioural finance can help investors navigate unpredictable markets

As anyone who has run money in the markets will agree, investing is often an emotional business. This is particularly true in volatile periods like the present. 

With a range of different factors at play – softening commodity markets, the uneven global economic climate, China’s slowdown and the uncertain direction of interest rates – the risk that emotions may unduly influence investment decisions is especially high.

We believe that short-term market events and the emotions they trigger can risk material interruptions to thoughtful long-term strategies. But to counter these risks we need to acknowledge them, without losing sight of those long-term investment goals.

Emotion is a fact of investing; the challenge is to identify and address biases before they exert undue influence in the investment decision-making process. We have identified five common emotional traits, for each of which there is a solution, below:

• Unrealistic expectations: Ensuring realistic expectations for investment returns

• Loss aversion: Identifying appropriate risk levels and the “highest acceptable loss”

• Familiarity bias: Striving to reduce “home country bias” and over-reliance on the familiar

• Anchoring: Avoiding undue emphasis on a single point of reference, such as a stock index

• Overconfidence: Learning to respect the limits of one’s knowledge or investment strategy

Unrealistic expectations can be prompted by “recency bias” – the expectation that recent trends will endure – and the more familiar concept of confirmation bias, the natural inclination to search for and prioritise information that fits our preconceptions.

These might manifest themselves in an expectation, despite evidence to the contrary, for previously high-performing asset classes to remain so.

The key to countering this is to accept the reality of the market before events force a reassessment. Investors should use all available data, maintaining long-term investment plans and focusing on goals rather than short-term performance against a benchmark.

Finance professionals can counter clients’ own bias by prompting a discussion about their views rather than by providing unsolicited advice.

Putting this in the context of the rocky start to 2016, one might observe that sell-offs are a normal investing experience, even if they don’t seem so to investors lulled by a benign period.

Performance of index in 2015

Source: FE Analytics

The equity market correction that began in mid-2015 might have been a brutal experience, for example, but 10 per cent declines are actually more normal than abnormal, occurring on average more than once a year over the last quarter century in the S&P 500.

But given that there hadn’t been a market decline of this magnitude for four years until late 2015, it was natural – if illogical - for expectations to shift in line with improving conditions.

Loss aversion describes the preference of those who seek to avoid losses more than they wish to acquire gains. Dealing with this isn’t a simple question of changing the bias, especially in view of the fact that higher risk strategies tend to produce more outlying results on either the positive or negative side rather than “average” returns likely to be within acceptable bounds for the investor.

Key techniques include identifying the extent of loss-aversion and the highest acceptable loss. This in turn can form the basis of a strategy to reduce risk using effective portfolio construction, designed with both investment objectives and the investor’s risk aversion in mind.

Well-constructed portfolios are an essential element of behavioural finance.

Relevant in benign markets as much as volatile ones, we believe robust portfolios require long-term allocation choices based on more than the recent past and on more than one or a few recently high-performing asset classes – exactly the kind of thinking that limits the risks presented by short-term emotional reactions.

Familiarity bias is both an emotional behaviour and a risk run by passive investors who automatically over-allocate to domestic stocks and other investments (“home country bias”). It carries three main risks: the exclusion of alternative investment opportunities; limitation of diversification; and the assumption of unnecessary total risk.

Home country bias in particular presents concentration risks – every national equity benchmark will have a particular bias to certain industries, as well as indirect exposures to other geographies via constituent stocks dependent on cashflows from key offshore markets.

Ways to counter familiarity bias include making a conscious decision to become more familiar with alternatives – the tools exist to enable investors to judge the relative performance of different asset classes.

Another option takes us back to the key principle of effective portfolio construction: a “core and diversified” approach, based on core investments in mainstream asset classes with a marginal overlay of diversifier investments such as high yield or international small cap equity, can reduce portfolio risk while leaving room for higher returns.

Performance of indices over 10yr

Source: FE Analytics

Anchoring, the mental shortcut by which investors place excessive emphasis on a single reference point, is a similar inhibitor of logical investment decisions.

Investors can counter this bad habit by questioning their reference points – especially the “high water mark” of favoured stocks – and by adopting diversified benchmarks.

Over-confidence is a perennial risk for investors and is a trait frequently rooted in most of the behaviours discussed previously.

Symptoms include investors’ tendency to overestimate the accuracy of their information; to hold insufficiently diverse portfolios; to retain underperforming investments while selling winners; and to trade with unnecessary frequency.

To combat this, we believe investors should embed an investment process based on confidence in their long-term strategy, thereby lessening the likelihood of unnecessary trading and turnover.

Part of this process is frequent self-assessment and appraisals of trading history, identifying in particular incidents of unnecessary trading that had a deleterious effect on performance.

These emotional characteristics are each an understandable quirk of human nature, the flipside of the creativity and ingenuity inherent in thoughtful investing.

By acknowledging them and putting in place measures to offset the associated risks, investors can turn potential weaknesses into strengths. - trustnet

Investing: Factors of Portfolio Performance

Asset allocation among other determinants accounts for most of the performance in a diversified investment strategy

Interest in stock market movement has grown during the past decade. More individuals own shares as part of their portfolio than a decade ago. It is very important to understand the determinants of portfolio performance. Empirical investigation in investment science literature during the last couple of decades established that a portfolio’s performance is largely a function of different factors. The factors that majority investors think that are important for performance are in fact relatively inconsequential. Let us discuss some of the important determinants of your portfolio performance.

Investment policy

The first is investment policy, which sets your default allocation of investible funds to each of the major asset classes, such as equities, fixed income, gold, cash, and so forth. The key characteristics of an investment policy are its long-term focus and asset allocation strategies. Asset allocation is the process of deciding how to distribute an investor’s wealth among different countries and asset classes for investment purposes. An asset class is comprised of securities that have similar characteristics, attributes, risk-return relationships. A broad asset class, such as bonds, can further be divided into smaller asset classes, such as treasury bonds, corporate bonds, and high-yield bonds. In the long run, the highest compounded returns will most likely accrue to those investors with larger exposures to risky assets. The asset allocation decision is not an isolated choice; rather, it is a component of a portfolio management process.

Market timing

The second major determinant in portfolio performance is market timing, which leads to deviations from the default allocations dictated by your own investment policy. Your investment policy might call for you to be fully invested in stocks, for example, but you also might believe that stocks are extremely overvalued right now and decide to be only 50% invested in equities. This deviation from policy is popularly known as market timing which is an important determinant in portfolio performance.

Market cycle

Asset classes have unique cycles. In some years, small and value stocks may outperform the market; in others they may underperform. It takes resilience and psychological preparedness to endure the times they underperform. Remember, investing in small and value stocks should augment the bottom line in the long run, but investors should understand that their portfolio will not identically track the market every single year.

Security selection

The other major determinant of portfolio performance is security selection. Do the particular securities you own do better or worse than their asset class as a whole – this is an interesting question which always ringer at the back of the mind of each investor. For instance, on average, being fully invested in stocks was very profitable during the decade of the 1990s. But it would have been a lot less profitable if your entire stock portfolio was invested in only a few particularly poor-performing small-cap value stocks. This could have lowered the return which is attributable to share selection.

Markets work

Capital markets do a good job of fairly pricing all available information and investor expectations about publicly traded securities.
Intense competition drives the market to near-efficiency though not complete efficiency. Securities prices are fair and reflect the best estimate of the company’s actual value. Efforts to identify undervalued stocks or markets are always rewarded in spite of fair pricing based on available information as there is always information asymmetry exists in capital markets across the globe.

Diversification is key

Comprehensive asset allocation can neutralize the risks specific to individual securities. It reduces the impact of individual securities and enables investors to scientifically employ the risk factors that offer higher expected returns.

Risk and return are related

The compensation for taking on increased levels of risk is the potential to earn greater returns. Only non-diversification risk is systematically rewarded over time. So, differences in the average returns of portfolios are due to differences in average risk. Multifactor investing brings a systematic approach to harnessing these risks to deliver above-market performance over time.

Portfolio structure explains performance

The asset classes that comprise a portfolio and the risk levels of those asset classes are responsible for most of the variability of portfolio returns. Asset allocation among other determinants accounts for most of the performance in a diversified investment strategy.

Deciding on the degree to which your portfolio should be based on the above factors is the challenge for the investor. Tilting towards small and value stocks will help you reach above global market returns, but portfolio risk must be tempered by adding other assets with low correlations. - financialexpress

Finding A New Balance With Alternatives

Summary

• The expected strong bond returns within a traditional 60/40 portfolio are unlikely in our current low yield environment.
• Investors should consider incorporating alternatives into their portfolios for optimum diversification.
• BMO Global Asset Management recommends compiling a complementary blend of active alternative managers and multi-alternative strategies.

Alternative investment options available to most investors present challenges and opportunities. Until recently, retail investors had limited access to alternative strategies and therefore may not be very familiar with these types of investments and how they can add value. They are increasingly popular, with assets in liquid alternative funds growing from around $50 billion in 2006 to more than $300 billion in 2015. What often gets lost when investors are sorting out all these distinctions is the reason they turned to alternatives in the first place. A better understanding of the role of alternatives in today's economic environment - and in tomorrow's - can help guide investors' decisions as they weigh their options in the alternatives space.

As we move further away from the Great Recession, the traditional 60/40 portfolio faces headwinds. This much-used paradigm allocates 60 percent of a portfolio to equities and 40 percent to bonds, balancing over the long term the growth (and higher risk) associated with equities with the stability (and lower risk) associated with bonds. Yet a significant assumption within the 60/40 paradigm - historically strong bond returns with low volatility - is no longer realistic with low bond yields in the current environment. We expect that even moderately risky balanced portfolios should expect more than a four percent decrease in returns over the next 10 years compared to what a 60/40 portfolio delivered in the last 35 years.

Investors need to find a way to adapt, as doing nothing may result in missing one's diversification objectives. Assuming lower returns, greater risk or reduced liquidity are unsatisfactory options; a plan to find new sources of return should involve choosing from a spectrum of alternative options, noting these should provide either a higher return for the same amount of risk or the same return for a lower amount of risk.

To meet these diversification challenges, investors will need to distinguish liquid alternative strategies that rely on new market exposure, such as volatility and frontier markets, and those that rely on manager skill, such as market neutral, 130/30, long/short equity and macro strategies. Here it is important to note that many "new market exposures" may already appear in investors' portfolios via REITs and commodities. The difficulty of finding truly new exposures, then, encourages a longer look at active management.

Our research indicates best practice may be to compile a complementary blend of active alternative managers specializing in different strategies, thus creating a multi-alternative fund. Manager selection in the alternatives space is arguably more difficult than in traditional long-only strategies. As evidence of this, we have found the dispersion of returns among several categories within the alternative space is greater than that of long-only funds. More importantly, we believe such dispersion among alternative managers suggests diverse sources of alpha: Alternative managers generate alpha using very different skill sets.

When conducting due diligence, it's important to take sources of differentiation into account in regard to strategy, performance, risk management, organization and structure, among other items. To avoid diluting the contribution of an individual manager, we recommend a pool of six to 10 underlying managers while evenly distributing allocation to each one.

A multi-alternative fund can offer access to a concentrated portfolio of alternative managers, combining front-end due diligence, portfolio construction and management, and risk oversight, all performed by experienced, professional managers. The built-in diversification of multi-alternative approaches helps answer the fundamental question that began the search process in the first place: Is the portfolio diversified by manager and strategy? In short, an alternative allocation that combines expertise on manager research, asset allocation, portfolio construction and risk management should offer a flexible, portfolio-ready option. - seekingalpha


About BMO Global Asset Management

BMO Global Asset Management is a global investment manager delivering service excellence from 27 offices in 17 countries to clients across five continents. Including discretionary and nondiscretionary assets, BMO Global Asset Management had CDN $304 billion in assets under management as of January 31, 2016.