Insight Thanksgiving Digest 2021

On FactSet Insight, we strive to produce high-quality macroeconomic trend analysis and thought leadership on a weekly basis. Today, we've selected five of our best all-time stories. They have demonstrated their popularity with consistent traffic and shares months (and sometimes years) after their initial publication.

What Ultra High Net Worth Clients Want from Wealth Managers

Our research shows that those at the upper end of the wealth curve are increasingly risk averse and so actively seek detailed insights about their investments. To support clients better, advisors will need to share portfolio data more often as well as demonstrate secure technology and robust suitability processes. Read more.

Demystifying Fixed Income Attribution

While fixed income attribution has evolved dramatically over the past decade or so, two commonly held perceptions remain: 1) it’s hard to understand and 2) it’s hard to implement. These perceptions are often cited to explain why fixed income attribution is a less successful and under-used technique relative to equity attribution. Read more.

Mind Your Ps and Qs: Real World vs. Risk Neutral Probabilities

In finance, we encounter real-world probabilities all the time. The outcomes are treated as equally likely, and the probability distributions are determined through econometric modeling. Many have probably also heard of “risk neutral” probabilities, where the probability measure is determined from market expectations and ensures that any instrument that can be statically hedged will be priced exactly, and that the probabilities of movements are taken from option prices.  Read more.

Five Lessons on Machine Learning-Based Investment Strategies

There is no doubt that in the hands of a skillful practitioner, machine learning is a powerful tool. However, careful consideration is needed when framing the problem to minimize the impact of noisy data and the danger of overfitting. Understanding how machine learning models and the strategies built from the work is also key when applying machine learning to portfolio management. Read more.

For ESG in Fixed Income, Proof Is in the Pudding

Managing exposure to ESG factors is a growth opportunity for fixed income asset managers, displays potential for outperformance globally, and is a value-added risk management technique on an ex-post and ex-ante basis. ESG strategies have grown dramatically in the equity space over the past decade and will continue to increase in importance for fixed income investors. Read more.