Really enjoyed Fox’s book The Myth of the Rational Market, and I’m going to add it to the Reading List. Although I wish Fox would have mentioned Andrew Lo in the book and his AMH.
—-
My first pass at the FAQ is finally up! email more questions to mf@cambriainvestments.com with FAQ in the subject line.
—-
My paper just passed 30,000 downloads. Next stop, Market Efficiency, no irony there…
—-
Does Einhorn have Buffett’s ear?
—-
Costs of higher education Parts 1, 2, and 3.
—-
Interesting news that Covestor is launching their Multi-Manager platform. I am really surprised this received SEC approval, but congrats Perry and team for getting it done where others could not (namely Vestopia, Cake, and Ka-ching – which I include because it uses “fantasy” portfolios rather than real money).
I have some real concerns about conflicts of interest and their fiduciary role (ie minimum trading volume in a stock is only 10,000 shares traded), but time will tell how that plays out.
I think Covestor will be successful as a company. I do not, however, think the underlying investors will have the same success. This has nothing to do with Covestor of course, but everything to do with investor behavior – namely chasing the hot hand. (ie check out all the DALBAR studies and the recent Bogle ETF studies.) One could call this a massive exercise in survivor bias (check out the underperforming Marketocracy mutual fund as an example).
This could be a decent option for smallish RIAs and BDs to essentially outsource their back-office, or to completely eliminate client interactions (positive or negative for the advisor, depending).
