The Research Affiliates' annual Advisory Panel conference brings together researchers to delve into economic and investment issues relevant to investors. The forum is intended to stimulate broad insights and lively debate. We highlight here summaries of the most recent Advisory Panels.
Of Clustering, Cyclicality, and Crisis
Advisory Panel 2016
Open and inquiring minds met again this year for the 2016 Advisory Panel. In late March, attendees participated in discussions that covered a broad array of investor concerns—from what performance can really tell us about manager skill to the seemingly illogical wisdom of picking losers, from capturing a large set of anomalies in two “mispricing” factors to the limits of a neoclassical economic model in forecasting a systemic liquidity crisis. Participants also explored the looming economic crisis of underfunded pensions as well as the implications of defining inequality in consumption terms rather than in wealth terms. Rob Arnott concluded the Advisory Panel by introducing Research Affiliates’ recent research on how rising valuations in smart beta are largely responsible for the “alpha” these strategies have earned, with value strategies an exception to the rule. The bottom line is valuation matters.
Factors in the Real World
Advisory Panel 2015
The 2015 Advisory Panel; which included the two Nobel laureates Harry Markowitz and Vernon Smith, welcomed speakers who discussed vetting return factors, implementing factor-based strategies in the absence of factor markets (as investors can only trade in assets), evaluating global and emerging market risks, and using the Shiller P/E in estimating expeced returns.
Critical Thinkers at Work
Advisory Panel 2014
The 2014 Advisory Panel had no stated theme, allowing speakers to address the topics they found most interesting. The result was an extraordinary conference on issues ranging from public perceptions of the investment industry to equity price changes in the days before a Federal Reserve announcement.
Hard Times Ahead
Advisory Panel 2013
The 2013 Advisory Panel was organized around two big quality-of-life themes: 1) the implications of government intervention in the economy and the capital markets, specifically including federal housing and monetary policies, and 2) the potential need to ration future retirement benefits.