Quo vadis bonds?

Quo vadis bonds?

Is the yield of 0.75% p.a. on the 10-year Bund economically rational or a speculative bubble? Investors who bet on bonds at the start of 2014 will look back on the year with satisfaction: All bond markets enjoyed a remarkably positive performance up to 30 November. This performance ...

No miracle solution

No miracle solution

Through their actions, the central banks are making life hard for savers who are not prepared to take risks and who traditionally favour money-market investments rather than term deposits or savings accounts. The yield offered by these investments is now close to zero . Some banks are even considering ...

Glass half full or glass half empty

Glass half full or glass half empty

How should we view the stock markets at the moment – optimistically (glass half full) or pessimistically (glass half empty)? Glass half empty The stock market rise over the last two years has not been supported by an increase in company earnings. In Europe, these have even fallen, which ...

Competitive Advantage - Inherent to “Business-Like Investing”

Competitive Advantage - Inherent to “Business-Like Investing”

Taking the definition from Wikipedia, a competitive advantage occurs when an organisation acquires or develops an attribute or combination of attributes that allows it to outperform its competitors. In 1980, Michael Porter identified five competitive forces that shape every industry and ...

The friendly merger of Covidien and Medtronic: A real life case study for Business-Like Investing

The friendly merger of Covidien and Medtronic: A real life case study for Business-Like Investing

The manufacturers of cardiovascular and orthopaedic medical instruments are continuing to see a slowdown in growth in all market segments. Ongoing reforms to healthcare systems all over the world will continue to impact the power of companies to negotiate prices and limit their potential to improve ...

BL-Global Flexible: Situation as at end of April

BL-Global Flexible: Situation as at end of April

Asset allocation The main problem for a balanced fund continues to be the low level of interest rates, which renders money market and bond investments rather unappealing, and makes equities the default investment . Stock market prices ...

From risk aversion to loss aversion (part 2)

From risk aversion to loss aversion (part 2)

"Rule #1: Never lose money" (Warren Buffett)  To my mind, the stranglehold of this academic approach to portfolio management deflects the investor's attention from the main risk of any investment, the risk of losing money. It would therefore seem to be more appropriate to ...

Strong Euro or Weak Dollar?

Strong Euro or Weak Dollar?

The euro's strength continues to surprise. The single currency has not been particularly affected by the geopolitical climate, although it would have been reasonable to suppose that the conflict between Russia and Ukraine, to which Europe is significantly more exposed than the United States, would ...

From risk aversion to loss aversion (part 1)

From risk aversion to loss aversion (part 1)

The terms risk, volatility and return are often linked in finance. This inter-connection has its roots in an academic financial theory on portfolio management that has become widespread in the professional sphere. It uses volatility as a measurement for risk which diverts attention away from ...

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BLI's investment management methodology consists of three steps: strategic asset allocation, tactical asset allocation and securities selection.

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16/12/2014 - Quo vadis bonds?