The Investor's Guidebook to Alternative Investments: The Role of Alternative Investments in Portfolio Design

Stuart R. Veale

Language: English

Pages: 256

ISBN: 0735205302

Format: PDF / Kindle (mobi) / ePub

A concise, yet comprehensive, guidebook that addresses the practical aspects of investing in fixed income investments.

The Investor’s Guidebook series presents investment vehicles and strategies from both the issuers’ and the investors’ perspectives. Starting with basic concepts and then building to state-of-the-art pricing models, strategies, and tactics, these succinct handbooks will be useful for everyone from new hires through experienced professionals. Unlike most books, which are read once and sit on the shelf, professionals will refer to these books repeatedly throughout their careers.

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will argue that this places a value on human life—which is true—but we do that all the time. We could make a car that was so safe that you would never get hurt in an accident. Of course, the car would be so expensive no one could buy it. So, we accept the trade-off of an affordable car for a reasonable risk of death/injury while driving. Medicare would become an affordable program which would meet the complete needs of 95 out of 100 retirees. Those who wanted to could buy a catastrophic policy

large quantities of cash or even buying a train ticket with cash will often invite unwanted and unwarranted police scrutiny. CHAPTER FIVE Is the United States Past the Point of No Return? Given all of the issues we’ve discussed thus far and knowing where we are on the death spiral, can the United States get back to a balanced budget—or more precisely a budget surplus—so that it can start paying down its debt? Is there another Volcker out there who will reverse the money printing and

like crazy and by doing so, is causing the value of its currency (the dong) to plummet (USD80 = VND1MM). The people are trying to protect themselves by buying gold as an inflation hedge. The government, as all governments do in this situation, is trying to prohibit the importation and purchase of gold so that the people are forced to hold its paper currency—even as its value declines to zero. China holds approximately $2 trillion worth of US Treasury securities in its reserves. It also is

FIGURE A.1 Perfectly Positive Correlation On the other hand, the two asset classes shown in Figure A.2 have a perfectly negative correlation. This means that when the value of one asset class increases, the value of the other decreases. As before, the portfolio’s value is the sum of the two assets—but in this case the portfolio’s value rises evenly over time with little volatility. FIGURE A.2 Perfectly Negative Correlation As an example, let’s first look at a portfolio composed of

70, 79, 202 AFSCME (Association of Federal State County and Municipal Employees), 38 aging impact on shopping, 188 AGOL (ETFS Physical Asian Gold Shares), 106 airports in US, 43 “air rights,” 182 Akoya oyster, 159 AKR (Acadia Reality Trust), 206 Alaska, 62 alexandrites, 148, 153, 155 Algeria, 81 Allianz Asset Management, 82 Allied Nevada (ANV), 119 Alternative Investment Quarterly Newsletter, vii alternative investments, xv–xviii, 1–9 collectibles, xvi, 7, 8, 91 conservative

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