Beyond smart beta : index investment strategies for active portfolio management / Gokhan Kula, Martin Raab, Sebastian Stahn.

Format:

Book

Author/Creator:

Kula, Gökhan, 1976- author.

Raab, Martin, author.

Stahn, Sebastian, 1986- author.

Series:

Wiley finance series.

THEi Wiley ebooks.

The Wiley Finance

THEi Wiley ebooks

Language:

English

Subjects (All):

Portfolio management.

Stock index futures.

Investments.

Physical Description:

1 online resource (243 pages).

Edition:

1st ed.

Place of Publication:

Chichester, [England] : Wiley, 2017.

System Details:

Access using campus network via VPN at home (THEi Users Only).

Summary:

Delve into ETFs for smarter investing and a weatherproof portfolio Beyond Smart Beta is the investor's complete guide to index investing, with deep analysis, expert clarification and smart strategies for active portfolio management. From the general to the obscure, this book digs into every aspect of Exchange Traded Funds (ETFs) including ETCs and ETNs to break down the jargon and provide accessible guidance on utilising the indices as part of a more productive investment strategy. Succinct explanations of terms and concepts help you better grasp ETP anatomy, mechanics and practices, while examples, charts and graphs provide quick visual reference for total understanding. The expert author team examines the risks and benefits associated with various indexing approaches, sharing critical review of next-generation methods to help you make well-informed investment decisions. ETFs provide a solid foundation within mature and well-researched markets, allowing investors to focus on areas where active management has the potential to reap higher returns. This book shows you how to take full advantage of the growth of this market to strengthen your portfolio for the long term. * Assess the current landscape and the anatomy of ETFs/ETPs * Understand ETP handling, costs, trading, and investment * Evaluate the pros and cons of next-generation indexing approaches * Avoid risk while incorporating indices into an active portfolio management strategy Index concepts have evolved from basic, passive investments through Smart Beta, and are evolving into a third generation of products that will quickly become an important element of investor portfolios. Key benefits have propelled ETFs to surpass hedge funds in global capital, and the growth shows no sign of slowing. Beyond Smart Beta provides a primer for investors seeking to understand - and take advantage of - these lucrative new products.

Contents:

Cover

Title Page

Copyright

Contents

Preface

Acknowledgments

About the Authors

Chapter 1: The Beauty of Simplicity - The Rise of Passive Investments

Outperformance - A Tough Challenge

Institutional Investors: A Small Change in Allocations, A Big Step for Passive Investments

Not All "Big Guys" Love ETFs

Note

Chapter 2: The History of Indexing and Exchange-Traded Products

Frequent Pricing Thanks to Copper and Feather

Journalist Trio Pictures the Market

Indexation Across the Globe

Customized Indexing aka Smart Beta

Exchange-Traded Funds - A Unique All-rounder

Rising Bars, Soaring Product Launches: The Global ETF Market at a Glance

ETF's Legal Structures at a Glance

Replication Methods

Trading ETFs

Leveraged and Inverse ETFs

ETFs vs. Futures

Exchange-Traded Commodities - Heavy Metal Even for Lightweight Investors

Commodities - An Asset with a Long History

ETCs Democratize Investing in Commodities

Commodity ETF vs. ETC: Same Goal, Different Features

How are ETCs Constructed?

Different Product Designs

Sources of Return

Fees of ETCs

Exchange-Traded Notes - The Underdog

How are ETNs Constructed?

Trading and Early Redemptions

The Issuer is Gone, Your ETN is Gone

Notes

Chapter 3: Index Evolution

Benchmark Indices

Market Cap Weighted Indices - "The Bigger, the Better"

Equal-Weighted Indices - "One Stock, One Vote"

Fundamentally Weighted Indices - "New Age Parameters Count"

Factor Indices - "The Growing Zoo"

Benchmark Questions for Investors

Equity Benchmarks

Sector Indices

Selected Sector Indices Overview

Fixed-Income Benchmarks

Additional Fixed-Income Benchmark Families

Commodities and Alternative Benchmarks

Smart Beta Indices (Second Generation of Indexing)

Defining Smart Beta - A Tough Challenge.

Factor Investing

Alternative Weighting Strategies

Getting Smart about Beta

Next Generation Indices (Third Generation of Indexing)

Reducing Behavioral Gap

Adding the Risk Perspective to Indexing

Factor Rotation Strategies

Dynamic Risk and Asset Allocation Strategies

Chapter 4: The Good, Bad and Ugly - A Critical Review of Today's Indexing Approaches

Synthetic vs. Physical Replication

Trading Costs of ETFs - Case Study "Flash Crash, August 24, 2015"

Second Generation Indexing Critique - The Bad Ones

Commodity/Energy/Oil ETP Products

Volatility ETPs

Chapter 5: Advantages Unlimited - Portfolio Application Strategies for Superior Index Investing

Never Underestimate the Importance of Investment Costs

Annual Management Fee

Additional Operational Fees

Transaction Costs

Performance Fee

Other Fees, Like Initial Charges and Redemption Fees

Comparison of Active Fund Management Fees vs. Passive ETFs

Smart Beta Deconstruction

The Magic Money Tree of the Investment Industry?

The Ultimate Alpha Machine? Not Really . . .

Conclusion

Mind the Behavioral Gap - Earning More by Avoiding Investing Errors

Herding - "The Low Volatility Bubble" Case

Quantifying the Behavioral Return Gap

The Next Generation of Asset Allocation - Risk Factor Allocation Approach in Portfolio Construction

Asset Allocation - the Most Important Risk and Return Component

From the Use of Individual Risk Factors to a Portfolio Multi-risk Factor Implementation

The Ultimate Question: Passive or Active?

Chapter 6: Unchaining Innovation - The Future of Active Investing in Passive Products

Alternative Investing

Hedge Funds are Also Facing New Rules

Some Seek Alternatives to Traditional Alternative Investments

Selected Alternative ETF Strategies.

Advantages of Alternative ETFs

Hidden Costs and Risks to Watch Out For

Environmental, Social and Governance (ESG)-Based Investments

Doing Good and Doing Well?

Isolating the SRI Factor

Does the SRI Alpha Exist?

The Relative Valuation Critics

Customized Indexing

Customized Equity Indices

Trend Plays

Customized Fixed-Income Indices

Customized Commodities Indices

Glossary

References

Index

EULA.

Notes:

Includes bibliographical references and index.

Description based on print version record.

ISBN:

9781119315278

1119315271

9781119395263

1119395267

9781119315285

111931528X

OCLC:

981509002