Название: Advanced Portfolio Management
Автор: Giuseppe A. Paleologo
Издательство: John Wiley & Sons Limited
Жанр: Ценные бумаги, инвестиции
isbn: 9781119789802
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Advanced Portfolio Management
A Quant’s Guide for Fundamental Investors
Giuseppe A. Paleologo
Copyright © 2021 by Giuseppe A. Paleologo. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600, or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008.
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Library of Congress Cataloging-in-Publication Data is Available:
ISBN 9781119789796 (Hardback)
ISBN 9781119789819 (epdf)
ISBN 9781119789802 (epub)
Cover Design: Wiley
Cover Image: © Giovani Battista Piranesi, Public Domain
To Tofu
Chapter 1 For Whom? Why? And How?
I wrote this book for equity fundamental analysts and portfolio managers, present and future. I am addressing the reader directly: I am talking to you, the investor who is deeply in the weeds of the industry and the companies you cover, investigating possible mispricings or unjustified divergences in valuation between two companies. You, the reader, are obsessed with your work and want to be better at it. If you are reading this, and think, that's me!, rest assured: yes, it's probably you. You were the undergraduate in Chemical Engineering from Toronto who went from a summer job at a liquor store to founding an $8B hedge fund. The deeply thoughtful Norwegian pension fund manager who kept extending our meeting asking questions. The successful energy portfolio manager who interviewed me for my first hedge fund job, and the new college graduate from a large state university in Pennsylvania taking a job as an associate in a financials team.
I imagine that these readers are at different stages in their careers. Since the companies they cover are fundamentally different, they do think in different ways. But they all share a feature: they all have valuable trading ideas but realize that having good ideas is useless without the knowledge of how to turn them into money. This is the objective of portfolio construction and risk management: how to put together a portfolio of holdings that will be profitable over time and will survive adversities. This book is a short, incomplete guide toward investment enlightenment.
There is a second group of readers who will benefit from this book: the quantitative researchers who are, more and more, essential members of fundamental teams. There is not a strict separation between PMs and quantitative researchers. The quantitive researchers will find the appendix useful, if they want to implement programmatically the advanced tools the book describes.
1.1 What You Will Find Here
The book introduces a few themes, and then revisits them by adding details. You will learn how to:
1 Separate stock-specific return drivers from the investment environment's return drivers;
2 Size your positions;
3 Understand your performance;
4 Measure and decompose risk;
5 Hedge the risk you don't want;
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