Financial Analysts Journal

Editor’s Corner

  1. Richard M. Ennis

In the realm of institutional management, although asset allocation models abound, most institutions periodically conduct investment policy studies, and policy statements exist, a wide gap exists between theory and practice in investment policy research. Signs of the gap lie in the failure to integrate in portfolio policy the pension/endowment portfolio with the institution’s other assets and liabilities, in what appears to be herding in portfolio allocations, and in the misallocation of resources to active management rather than policy research. In short, practitioners lack a professional method for investment policy development.

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