| |
| |
| Preface | |
| |
| |
| Acknowledgments | |
| |
| |
| |
| The Importance of Private Capital | |
| |
| |
| |
| Wealth in America | |
| |
| |
| The Indespensable Rich | |
| |
| |
| Democracy and Capitalism | |
| |
| |
| Capitalism and Its Contradictions | |
| |
| |
| Providential Societies | |
| |
| |
| Risk and Strength | |
| |
| |
| America and Decline | |
| |
| |
| On China | |
| |
| |
| Addressing the Declinists | |
| |
| |
| Conclusion: American Distinctiveness and Private Wealth | |
| |
| |
| Notes | |
| |
| |
| |
| Creative Capital | |
| |
| |
| A (Brief) Moral History of Capitalism | |
| |
| |
| The Ancients | |
| |
| |
| Moral Arguments for Capitalism<sup>4</sup> | |
| |
| |
| Creative Capital in America | |
| |
| |
| Higher Education: The Case of St. John's College | |
| |
| |
| Politics: The Conservative Resurgence | |
| |
| |
| New Business Ideas: Venture Capital in America | |
| |
| |
| Creative Capital and Vibrant Societies | |
| |
| |
| Why Do Creative Capitalists Persist? | |
| |
| |
| The Indispensable Nation | |
| |
| |
| Conclusion: Underdogs and Bullies | |
| |
| |
| Notes | |
| |
| |
| |
| The Stewardship of Wealth | |
| |
| |
| |
| Are We Living in a Permanent Financial Crisis? | |
| |
| |
| The End of History (Again) | |
| |
| |
| A Permanent Financial Crisis? | |
| |
| |
| The Cause of the Crisis Matters | |
| |
| |
| The Industrial Revolution and Its Aftermath | |
| |
| |
| The Great (and Strange) Experiment | |
| |
| |
| Seize the Means of Production! | |
| |
| |
| The Power to Tax Is the Power to Destroy - Societies | |
| |
| |
| "Borrowing … the Disease Is Incurable" | |
| |
| |
| Now What? | |
| |
| |
| But, First, A Note About Germany | |
| |
| |
| Investing Capital in a (Very) Uncertain World | |
| |
| |
| Summary | |
| |
| |
| Notes | |
| |
| |
| |
| Risk | |
| |
| |
| Families and Investment Risk | |
| |
| |
| The Law of Supply and Demand (Again) | |
| |
| |
| Idiosyncratic ideas about risk | |
| |
| |
| Real Risks: Those Embedded in the Process of Investing | |
| |
| |
| Variance Drain | |
| |
| |
| Behavioral Finance: Are We Hard-Wired for Failure? | |
| |
| |
| Edith and the Headwinds She Faces | |
| |
| |
| What Should Edith Do? | |
| |
| |
| Conclusion: Preserving Wealth Is Hard Slogging | |
| |
| |
| Notes | |
| |
| |
| |
| The Collapse of Ethical Behavior | |
| |
| |
| What Caused the Crisis? | |
| |
| |
| An Unsavory Rehash of the Ethical Failures | |
| |
| |
| How Scandal Became Crisis | |
| |
| |
| Why Such an Ethical Swamp? | |
| |
| |
| Where Do We Go from Here? | |
| |
| |
| Fixing the Industry | |
| |
| |
| Notes | |
| |
| |
| |
| Finding the Right Advisor | |
| |
| |
| Open Architecture As a Disruptive Business Model in the Advisory World | |
| |
| |
| The Outsourced CIO Model | |
| |
| |
| Finding the Right Advisor for Your Family | |
| |
| |
| Conclusion | |
| |
| |
| Notes | |
| |
| |
| |
| Making Family Investment Decisions | |
| |
| |
| The Family Investment Committee Today | |
| |
| |
| Attempts to Deal with the Problem | |
| |
| |
| The Family Investment Committee, Tomorrow | |
| |
| |
| Opportunity Costs: Prudence versus Returns | |
| |
| |
| Conclusion | |
| |
| |
| Notes | |
| |
| |
| |
| Trusts | |
| |
| |
| Open Architecture Trusts | |
| |
| |
| A Brief, Unconventional (But Wickedly Accurate) History of the Common Law Trust From the Client's Perspective | |
| |
| |
| Down With the Bundled Trust! Up With the Open Architecture Trust! | |
| |
| |
| Private Trust Companies | |
| |
| |
| Total Return Trusts | |
| |
| |
| Conclusion: Let's Get Revolutionary | |
| |
| |
| Notes | |
| |
| |
| |
| The Rich Get Richer | |
| |
| |
| The Nuts and Bolts of Successful Investing | |
| |
| |
| |
| Designing Taxable Investment Portfolios | |
| |
| |
| Asset Allocation for the Private Investor | |
| |
| |
| The Markowitz Revolution | |
| |
| |
| Problems with Mean Variance Optimization | |
| |
| |
| Best Practices in Designing Investment Portfolios for Families | |
| |
| |
| Traditional Asset Allocation Modeling | |
| |
| |
| Modern Asset Allocation Modeling | |
| |
| |
| Satisfying Portfolio Claims Prudently | |
| |
| |
| Conclusion: Art versus Science | |
| |
| |
| Notes | |
| |
| |
| |
| Adding Value to Family Investment Portfolios | |
| |
| |
| Moving from the Current Strategy to the New Strategy | |
| |
| |
| Adding Value through Manager Selection | |
| |
| |
| Adding Value by Tactically Repositioning the Portfolio | |
| |
| |
| Adding Value through Opportunistic Investments | |
| |
| |
| Adding Value through Monitoring and Rebalancing | |
| |
| |
| Notes | |
| |
| |
| |
| Investing in US and Non-US Equities | |
| |
| |
| US Large and Mid-Capitalization Stocks | |
| |
| |
| US Small Capitalization Stocks | |
| |
| |
| International Developed Country Stocks | |
| |
| |
| Emerging and Frontier Markets | |
| |
| |
| Frontier Markets | |
| |
| |
| Notes | |
| |
| |
| |
| Investing Globally | |
| |
| |
| Why Go Global? | |
| |
| |
| Why Stay Home? | |
| |
| |
| Global Investing in the Real World (Or, Maybe, Real Investing In a Global World) | |
| |
| |
| The Bottom Line: Think Globally, Act Locally | |
| |
| |
| Conclusion | |
| |
| |
| Notes | |
| |
| |
| |
| Investing in Real Assets | |
| |
| |
| Real Estate | |
| |
| |
| Oil and gas | |
| |
| |
| Commodities | |
| |
| |
| Summary: The Use and Misuse of Real Asset Exposure | |
| |
| |
| Notes | |
| |
| |
| |
| Investing in Fixed Income | |
| |
| |
| Mistakes Bond Investors Make | |
| |
| |
| Employing Best Practices in Building Bond Portfolios | |
| |
| |
| Managing Cash | |
| |
| |
| Summary: Fixed Income Is Under-Appreciated | |
| |
| |
| Notes | |
| |
| |
| |
| Investing in Hedge Funds | |
| |
| |
| Conclusion: Should Anyone but Yale Invest in Hedge Funds? | |
| |
| |
| Notes | |
| |
| |
| |
| Investing in Private Equity | |
| |
| |
| Why Invest in PE? | |
| |
| |
| Persistence of Returns | |
| |
| |
| The Importance of Diversification | |
| |
| |
| Private Equity Returns | |
| |
| |
| The Return Characteristics of PE Investments | |
| |
| |
| Gaining Exposure to Private Equity | |
| |
| |
| PE Funds of Funds | |
| |
| |
| A Global Asset Class | |
| |
| |
| Illiquidity and the J-Curve Effect | |
| |
| |
| Ramping Up to Your Target Allocation | |
| |
| |
| Waterfall Analysis | |
| |
| |
| Secondary PE Investing | |
| |
| |
| The Evolution of Secondary Investing | |
| |
| |
| Secondary Investing Strategies | |
| |
| |
| Identifying High Quality Secondary Funds | |
| |
| |
| Conclusion: The Ultimate Aspirational Asset | |
| |
| |
| Notes | |
| |
| |
| |
| Working with Money Managers | |
| |
| |
| The Business of Money Management | |
| |
| |
| Traditional Managers | |
| |
| |
| Alternative Managers | |
| |
| |
| Conclusion: At Least Managers Are Interesting | |
| |
| |
| Notes | |
| |
| |
| |
| Managing Invest-Related Taxes | |
| |
| |
| Designing Portfolios from an After-Tax Perspective | |
| |
| |
| Asset Location | |
| |
| |
| Asset Class Strategies | |
| |
| |
| Tax-Aware Managers | |
| |
| |
| Harvesting Losses | |
| |
| |
| Summary: You Can't Eat Gross Returns | |
| |
| |
| Notes | |
| |
| |
| |
| Asset Location and Implementation | |
| |
| |
| Asset Location Issues | |
| |
| |
| Implementation Issues | |
| |
| |
| Conclusion | |
| |
| |
| Notes | |
| |
| |
| |
| Monitoring and Rebalancing Taxable Portfolios | |
| |
| |
| Performance Monitoring | |
| |
| |
| Rebalancing Taxable Portfolios | |
| |
| |
| Summary | |
| |
| |
| Notes | |
| |
| |
| |
| Investment Policy Statements | |
| |
| |
| The Investment Policy Statement | |
| |
| |
| Spending Policy Statements | |
| |
| |
| Cash Guidelines | |
| |
| |
| Manager Guidelines | |
| |
| |
| The Investment Committee Policy Manual | |
| |
| |
| Letters to the Family | |
| |
| |
| |
| Miscellaneous Challenges for Private Investors | |
| |
| |
| Asset Custody | |
| |
| |
| Concentrated Security Positions | |
| |
| |
| Establishing a Family Office | |
| |
| |
| Family Investment Partnerships | |
| |
| |
| Philanthropy | |
| |
| |
| Conclusion: There Are Challenges Everywhere We Look | |
| |
| |
| Notes | |
| |
| |
| Afterword | |
| |
| |
| On Happiness | |
| |
| |
| Stereotypes of the Rich | |
| |
| |
| The Rich and the "Faux Rich" | |
| |
| |
| The Real Way the Rich Are Different | |
| |
| |
| Children and the Wealthy | |
| |
| |
| Marriage and the Wealthy | |
| |
| |
| Work and the Wealthy | |
| |
| |
| Failed Stewardship and Family Unhappiness | |
| |
| |
| Wealth and Happiness | |
| |
| |
| Notes | |
| |
| |
| About the Website | |
| |
| |
| About the Author | |
| |
| |
| Index | |