Asset Allocation: Balancing Financial Risk, Fifth Edition

  • 6h 26m
  • Christopher J. Sidoni, Roger C. Gibson
  • McGraw-Hill
  • 2013

The Definitive Guide to Strategic Asset Allocation

Uniting theory and practice--the art and science of asset allocation

Investors long to beat the market, and money managers accept that as their mandate. The sad reality is that most money managers underperform the market, and individual investors do even worse. Investors also face emotional challenges. The irrational exuberance of the 1990s, for instance, can as easily derail a sensible investment strategy as the market panic accompanying the Global Financial Crisis.

Since Roger Gibson wrote the first edition of this book over 25 years ago, his multiple-asset class investment approach has given investors a disciplined strategy for mitigating risks and realizing their financial goals through widely varying market environments.

Grounded in the principles of modern portfolio theory, this fifth edition of his investing classic explains how and why asset allocation works. Gibson demonstrates how adding new asset classes to a portfolio improves its risk-adjusted returns and how strategic asset allocation uses, rather than fights, the forces of the capital markets to achieve financial success.

New topics in this edition include:

  • The success of multiple-asset-class investing during the stock market's "lost decade"
  • Methods for forecasting long-term asset class returns and the limitations of prediction
  • The dangers of market timing and the challenges involved in tactical asset allocation strategies--with insights from the field of behavioral finance
  • Observations from the Global SIDONI Financial Crisis of 2008 and what it means for the multiple-asset-class investor

With more than three decades of experience managing clients' portfolios and expectations, Gibson underscores the importance of identifying and working through the emotional and psychological traps that impede investment success.

Join the quarter-century trend of Asset Allocation providing investors with a sound approach to financial well-being.

About the Authors

ROGER C. GIBSON, CFA, is chief investment officer of Gibson Capital, LLC, which advises high net worth individuals and institutional clients nationwide. An internationally recognized expert in asset allocation and investment portfolio design, he lives with his wife and business partner, Brenda, in a pre-Civil war farmhouse north of Pittsburgh, Pennsylvania.

CHRISTOPHER J. SIDONI, CFA, CFP, is the director of investment research and a member of Gibson Capital, LLC. In addition to managing client relationships and directing the firm's research efforts, he speaks to professional audiences on the topics of asset allocation, portfolio design, and investor behavior.

In this Book

  • The Importance of Asset Allocation
  • U.S. Capital Market Investment Performance: A Historical Review
  • Comparative Relationships Among U.S. Capital Market Investments Alternatives
  • Dispersion and the Limits of Prediction
  • Market Timing
  • Time Horizon
  • A Model for Determining Broad Portfolio Balance
  • Diversification: The Third Dimension
  • Expanding the Efficient Frontier
  • The Rewards of Multiple-Asset-Class Investing
  • Portfolio Optimization
  • Know your Client
  • Managing Client Expectations
  • Portfolio Management
  • Resolving Problems Encountered During Implementation
  • The Global Financial Crisis of 2008