We all know that the strategic asset allocation decision determines 90+% of the long run return of your investment portfolio. And, it seems virtually every investment manager and consultant is there to trot out their model and tell you why it is the best guide to making the correct decision. But, it has been said that ‘All models are wrong Some are useful.’ Your manager will tell you its model is useful, but how do you know?
What questions should you be asking to better understand those asset allocation recommendations? How can you effectively compare one model to another to determine which is the best for your company’s portfolio?
This was presented at our Insurer Investment Forum XVIII.