Praise for Balanced Asset Allocation
"Alex Shahidi's book is a magistral piece that will be enjoyed by anyone with a serious interest in investing and asset allocation. The intellectual rigor with which Shahidi leads the reader from beginning to end is breathtaking, debunking many preconceived ideas from the institutional world while coming up with many novel and often counterintuitive ones. Through an analysis of various economic environments (past and future), Shahidi dissects the shifting correlations (and inverse correlations) between various asset classes (equities, fixed income, inflation protected securities, commodities…). This book is most timely in today's deleveraging, and possibly low return, world."
Charles de Vaulx, Chief Investment Officer and Portfolio Manager, International Value Advisers (IVA), and recipient of Morningstar's "International Stock Manager of the Year" award in 2001
"Building balance as described herein should be the foundation of all portfolios; this book is essential reading for any investor. Alex distills his comprehensive understanding of the economy, risk assets, and portfolio construction to its essence. The result is to make these valuable concepts accessible to a wide audience. Assimilating the wisdom in this book will increase the dependability of any portfolio."
Peter Joers, III, Co-Founder, Greenline Partners; former Client Advisor at Bridgewater Associates
"For many investors the most critical decision they make is in choosing their default portfolio. Yet for how important this decision is, remarkably little that is useful has been written. Alex does a phenomenal job proposing a simple yet effective solution. Balanced Asset Allocation is one of those rare books that is both easy to read and provides great insights."
Nick Nanda, Co-Founder, Kaleidoscope Capital; former Portfolio Manager on the Asset Allocation team at Grantham, Mayo, Van Otterloo & Co (GMO)
"There are many books on investing, but precious few that buck the consensus in a logical, well-argued manner. Read Alex Shahidi's book with an open mind and you are sure to become a better investor, even if you disagree with his unconventional analysis."
Samuel Lee, Strategist, Morningstar
Foreword Bill Lee ix
About the Author xiii
The Economic Machine: Why Being Balanced Is So Important Today 5
Your Portfolio Is Not Well Balanced 19
The Fundamental Drivers of Asset Class Returns 29
Viewing Stocks through a Balanced Portfolio Lens 49
The High Value of Low-Yielding Treasuries within the Balanced
Portfolio Framework 69
Why TIPS Are Critical to Maintaining Balance (Despite Their
Low Yield) 89
Owning Commodities in a Balanced Portfolio 101
Even More Balance: Introduction to Other Asset Classes 115
How to Build a Balanced Portfolio: Conceptual Framework 127
How to Build a Balanced Portfolio: The Step-by-Step Process 143
The Balanced Portfolio: Historical Returns 155
Implementation Strategies: Putting Theory into Practice 181
About the Website 197