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July Headlines
Business Owner Issues
Family Continuity & Governance
Family Education
Family Office Practice Management
Industry Trends and Issues
Integrated Planning
International Trends
Investment Planning
Lifestyle Management
Managing Risk & Liability Exposure
Strategic Philanthropy
Technology Trends
Family Office Exchange News
Business Owner Issues
Family Firms and Chief Emotional Officers
- An article published in Knowledge@Wharton discusses the importance of the informal role of chief emotional officer in a family business. Nearly all family businesses have an individual who provides emotional support and ensures family cohesion and direction. However, the authors warn that the chief emotional officer job can be stressful and go unrecognized. It also can fall dangerously by the wayside as businesses are passed on to succeeding generations. Written from a U.S. perspective but with points of generic interest.
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Family Continuity & Governance
Two Contributions on Family Continuity
When it comes to estate planning, wealth can be a great unifier or cause irreparable divisions. A paper by Northern Trust gives practical guidance on creating a family legacy that lasts. Includes thoughts on improving family communication.
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A paper published in Wealth Manager examines how to slow the journey to financial entropy over successive generations by circumventing, where possible, the disruptive effects of taxes, war, inflation, devaluation and political collapse.
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Family Education
Dealing with Alcohol and Drug Addiction
A paper by William Messinger and Terry Hunt discusses the impact of addiction on wealthy individuals and their financial advisors. The authors explore how to recognize the signs of addiction, seek competent assistance and support recovery, including what works for improved treatment outcomes. Of interest to advisors and wealthy families alike.
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Financial Plan Eases Pain of Loss
Contemplating death or divorce is not something that most individuals find easy to contemplate. However, the best strategy for dealing with loss is to have a financial plan in place beforehand. Northern Trust has produced a useful guide to navigating finances if you unexpectedly find yourself alone.
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Family Office Practice Management
Keeping Up With Family Office Issues
A new family office newsletter from Withers addresses a range of relevant topics, with an update on private trust companies, private equity investments in the luxury sector and a comparison of the U.S. and U.K. tax systems.
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Industry Trends and Issues
The Growth of Fund Management JVs in China
Since the first Sino-foreign joint ventures were approved in 2002, fund management has continued to be one of the most accessible sectors for foreign firms in China. A joint report by KPMG and Reuters considers the operational challenges, including setting the right terms, improving the efficiency of distribution channels and providing better education for investors. It also provides an analysis of size and performance metrics for different segments of the fund management industry.
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Integrated Planning
Introduction to Life-Cycle Investing
Drawing on 1950s models, the financial planning community tends to use mainly precautionary savings and diversification strategies to manage personal wealth. An article published in the Journal of Financial Planning describes the emergence of a new life-cycle investing approach: a multi-period model that uses hedging and insuring as well as precautionary savings and diversification as core strategies.
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International Trends
Real Estate in Russia
A paper by Knowledge@Wharton examines the Russian real estate market, where demand is rapidly outstripping supply and pricing is soaring. The paper warns foreign investors to beware, particularly in light of reports of unscrupulous practices by some local property developers.
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Investment Planning
An Extra Dimension to Modern Portfolio Theory
A paper by Aquillian Investments seeks to extend the risk/return trade-off of modern portfolio theory by introducing a third dimension: impact, or the benefits to be gained from investing in the social good. Based on the notion that people are not motivated by financial considerations alone, the paper’s author argues that a “new efficient frontier” provides a useful mechanism for evaluating portfolios that are truly optimal for real-life investors.
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Investment Perspectives
A series of articles from iShares discuss various topics of interest to wealthy investors:
- The first discusses methods of ensuring an investor’s portfolio is aligned with his or her needs and attitudes toward risk.
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- The second takes a look at the value inside multi-sector fixed income, examining the evolution of the market and innovations in investing.
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Focus on Hedge Funds
A survey of best practices in the hedge fund industry by Horizon Cash Management offers a detailed look at hedge fund investment processes, valuation policies, risk management, marketing, regulation and compliance. It finds general improvement in adoption of best practices, albeit with a number of areas with room for improvement.
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A briefing by the Family Investment Office examines liquidity risk in relation to funds of hedge funds. The authors warn that recent changes in the industry have led to misalignments in liquidity risk that could have severe consequences for investors if not properly managed.
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Lifestyle Management
Thoughts on Jet Safety
Private jet travel is extremely safe, but it can pay to check certain details before you fly. Helium Report has produced a checklist of facts that may be worth verifying before taking a charter flight.
- Click here to read the article
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Managing Risk & Liability Exposure
Empirical Scrutiny of Retirement Investment Strategies
Investment advisors often seek to rebalance asset allocation to reduce stock exposure for clients entering retirement. A technical paper published by the Journal of Financial Planning examines the case for this approach. The authors find that rebalancing provides no significant protection on portfolio longevity; in some cases, it actually increases the number of shortfalls.
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Strategic Philanthropy
Philanthropy Newsletter
A quarterly e-newsletter published by Philanthropy UK includes a number of articles of interest, including interviews with five leading philanthropists, who share their personal stories. Also includes an article by Sarah Brown (wife of Gordon Brown, the new British prime minister), who gives her top five tips for giving.
- Click here to view the article
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Technology Trends
Escaping From Technology
When you go on vacation, do your PDA and laptop go, too? While technology has made it increasingly possible for people to stay connected, it also has raised issues relating to work/life balance. An article at Inc.com examines the issues, with a particular focus on the demands placed on entrepreneurs.
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