Long And Winding Road | Mercer

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The Long and Winding Road
Calendar20 September 2017

Tragedy of The Horizon: Turnover Level of Activate, Long-Only, Equity Fund Managers

Looking at investment through an RI lens offers an investment view that is more likely to create and preserve long-term value. Every investor has unique objectives, though all are increasingly re-examining how they identify and manage risk. This involves articulating an investment time horizon, and then defining which risks warrant consideration beyond standard measures such as market volatility. Our proprietary tools, breadth of expertise, global scale, and decades of experience will help you towards yours.

How Long-Only Equity Managers Turn Over Their Portfolios Every 1.7 Years

The report "The Long and Winding Road: How Long-Only Equity Managers Turn Over Their Portfolios Every 1.7 Years" was part of the “Tragedy of the Horizon” research, which seeks to explore the potential for long-term suboptimal allocation of capital due to the finance sector’s limited ability to capture long-term risks within short-term risk-assessment frameworks.

Focus of Capital Markets to Secure a More Sustainable Allocation

Both short- and long-term investment practices have potential roles to play in a diverse portfolio, though the overall equity marketplace seems skewed toward shorter-term behavior.

We believe there are many potential drawbacks to short-termism which need to be better understood; the same holds for the potential benefits of long-termism.

 

 

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