Asset Rotation – The Demise of Modern Portfolio Theory and the Birth of an Investment Renaissance

<p>Acknowledgments xi</p>
<p>Prologue: David &amp; Goliath xiii</p>
<p>Preface: We Stand on the Precipice of an</p>
<p>Investment Renaissance xv</p>
<p>Chapter 1: taking the 30,000–Foot View 1</p>
<p>Where We Are Today</p>
<p>The Individual Investor 1</p>
<p>Ockham s razor 3</p>
<p>Our Current economic Landscape 6</p>
<p>The Bottom Line 11</p>
<p>Chapter 2: When the paradigm shifts 13</p>
<p>Why What Worked in the Past May No Longer</p>
<p>Work in the Future</p>
<p>A primer on Modern portfolio theory 15</p>
<p>The treasury run 19</p>
<p>Losing Money in Bonds 29</p>
<p>The Bottom Line 32</p>
<p>Chapter 3: shooting stars 35</p>
<p>The Performance Realities of Mutual</p>
<p>Fund Ownership</p>
<p>The persistence of Manager performance 38</p>
<p>The Bottom Line 53</p>
<p>Chapter 4: Beyond the Stars 55</p>
<p>Suggestions for Investment Selection Criteria</p>
<p>The Cost of Investing 58</p>
<p>Identifying Risk 64</p>
<p>Assessing the Investment Environment 73</p>
<p>The Bottom Line 76</p>
<p>Chapter 5: The Landscape Has Changed 79</p>
<p>The Proliferation of the ETF</p>
<p>The ETF: What Is It? 80</p>
<p>A Brief History 83</p>
<p>The Use of ETFs in a Portfolio 86</p>
<p>The Bottom Line 94</p>
<p>Chapter 6: Challenging Convention 97</p>
<p>An Introduction to Asset Rotation</p>
<p>A Time–Tested Approach 106</p>
<p>The 2000s 108</p>
<p>The 1990s 110</p>
<p>The 1980s 112</p>
<p>The 1970s 113</p>
<p>The 1960s 114</p>
<p>The 1950s 115</p>
<p>The 1940s 117</p>
<p>The Great Depression 118</p>
<p>From the Great Depression to Today 119</p>
<p>The Bottom Line 121</p>
<p>Chapter 7: Building a Better Mousetrap 123</p>
<p>Advanced Asset Rotation</p>
<p>Building a Better Mousetrap 124</p>
<p>The 1990s 134</p>
<p>The 2000s 136</p>
<p>From 2010 to 2012 138</p>
<p>23 Years: 1999 2012 140</p>
<p>Going Toe to Toe with the Best 141</p>
<p>The Bottom Line 143</p>
<p>Chapter 8: Choose Your Own Adventure 147</p>
<p>Building Your Own Asset Rotation Portfolio</p>
<p>Choose Your Own Adventure 148</p>
<p>Additional Factors to Consider: Eligible Risk Assets 149</p>
<p>Additional Factors to Consider: Eligible Flight to</p>
<p>Safety/Fixed–Income Assets 159</p>
<p>Additional Factors to Consider: Criteria for Investment</p>
<p>Selection 163</p>
<p>Creating a Scoring System 165</p>
<p>Required Due Diligence 167</p>
<p>The Bottom Line 168</p>
<p>Chapter 9: The Anatomy of Change 171</p>
<p>Setting Appropriate Expectations</p>
<p>Benchmarking Success 172</p>
<p>The Four Seasons 175</p>
<p>When Equity Markets Rise 176</p>
<p>When Equity Markets Fall 177</p>
<p>When Equity Markets Move Sideways 180</p>
<p>When Equity Markets Move Sideways with Volatility 183</p>
<p>The Bottom Line 186</p>
<p>Chapter 10: Letting Go of Your Crutch 189</p>
<p>Integrating Asset Rotation into Your</p>
<p>Overall Approach</p>
<p>Citius, Altius, Fortius 190</p>
<p>Asset Rotation as a Core Approach 191</p>
<p>Baby Steps 195</p>
<p>Supplementing Either Equities or Fixed Income 195</p>
<p>Adopting a Core/Satellite Approach 198</p>
<p>The Bottom Line 200</p>
<p>Chapter 11: The Road Ahead 203</p>
<p>Real–World Solutions for a Changing Landscape</p>
<p>The Bottom Line 205</p>
<p>About the Author 207</p>
<p>Index 209</p>