While strategic asset allocation has the greatest impact on the performance of a portfolio, selecting the best specialists in the world to manage those underlying asset classes is a critical source of alpha, which compounds with time.
I love the Olympics. I can’t tear myself away from a screen when they’re on. Be it gymnastics, athletics, or table tennis, it’s a privilege to watch the best in the world compete in their fields. The Games also highlight parallels between athletics and investment management, particularly the power of specialisation – where those focusing on one discipline, who are the best in the world in their arena, outcompete the generalist.
While strategic asset allocation has the greatest impact on the performance of a portfolio, selecting the best specialists in the world to manage those underlying asset classes is a critical source of alpha, which compounds with time.
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