Best Blogs of the Week #273

Best Blogs of the Week #273

Two posts this week enveloping oft-used terms: smart beta & correlation.

BlackRockThe geekiest (and most important) number nobody is discussing – During the past 25 years, there has been a tendency for correlations to be higher when Fed policy is tighter. With the Fed tightening monetary conditions for the first time since the crisis, stock-bond correlations may be heading higher.

MainStay – Smart Beta: It’s Turning Up Everywhere – Some represent relatively minor tweaks to existing broad-based indexes, while others are more narrowly tailored to capture return from a specific geography, investing style, or asset class. As with any innovation, a great deal of education will be needed to help all different types of investors understand just how these different factors function and which approaches might be appropriate for them.

correlation