TIME IS AN ASSET
Time. It's what we do with it that matters to investors.
To see only in the moment is to take what's put before you. To look out into the distance is to believe in something more.
Of all the arrows in an investor's quiver, among the most powerful is time. Yet many asset managers and owners don't fully grasp how powerful an impact time can have on investment decision-making and outcomes.
Investors are increasingly short term in their orientation, even while demographic trends point to longer life expectancy and the need for larger pools of retirement funds.
Instant gratification is fleeting. True fulfillment takes time,
but offers greater potential reward.
Investors' misperceptions about what impacts their outcomes often make them spend too much time measuring what doesn't matter and not enough time on what does. It's time to start looking at what really counts when choosing an investment manager.
How does investor tolerance for underperformance line up with their understanding of a long-term perspective? Our Active Sentiment Study looked at their thoughts, behaviors and the connections between the two.
Recognizing potential takes insight. Making something of it takes passion and patience.
Given the powerful relationship between decision-making and time, a misalignment between the two can significantly impact investment outcomes. It's time to break through that disconnect – and better align asset management delegation decisions with investor time horizons.
The S-curve, which shows the growth trajectory of a company creating a new product or even a new industry can be an ally or enemy for investors. Skilled active managers try to find these companies much earlier on in the curve, with an eye toward tapping greater growth potential.
When patience, action and insight work in harmony, risk can be an ally not an adversary.
For many investors, risk is frequently an unwelcome four letter word: We are all too familiar with the painful consequences of unforeseen and excessive risks taken in the financial markets, not least of all the economic fallout from the global financial crisis in 2008–2009. And yet, in the investment context it is a truism that returns can only be generated when calculated risks are taken.