David Fleer
Bristlecone Value Partners, LLC
12301 Wilshire Blvd., Suite 320
Los Angeles, CA 90025 USA
Work 1-877-806-4141

CalPERS Gets it Right, Eventually

September 30th, 2014

CalPERS (California Public Employees’ Retirement System) – the $300 billion investment pool meant to fund the retirement benefits promised to many of California’s public employees—made news recently by announcing  that it was closing out all of its investments in hedge funds over the next year.

In some ways, this is a small decision not deserving too much attention. After all, hedge funds only accounted for 2% of the overall CalPERS allocation and the change won’t really have much impact on the fund’s performance. Still, many of our clients are California residents, as are we, and CalPERS is the largest state pension plan in the country, and very nearly the world. Even small changes at CalPERS have long-term ripple effects, for Californians and throughout the world of institutional investing.

First, let’s clarify what a hedge fund is. It’s a broad category, but generally speaking, hedge funds share at least these 3 characteristics:

1)      They are private investments, only available to accredited (i.e., larger) investors, unlike a stock or mutual fund that can be bought by anyone.

2)      They use some investment strategy meant to reduce volatility compared to equities; that is, they hedge. For example, they might use derivatives or short-selling to reduce net market exposure.

3)      They generally have a fee structure that includes both a management fee and an incentive fee, meaning the investment manager generally earns a portion of the investment profits. Read the rest of this entry »


Is Your Password Strong Enough?

September 10th, 2014

As indicated by a recent internet privacy breach (where private nude photos of celebrities ended up on public websites), it is becoming harder to keep secrets. In most cases, the photos were stolen from private iCloud accounts, leading to speculation that Apple’s security measures had been compromised.  As it turns out, there was a more mundane explanation:  many of the victims were simply lethargic about setting and maintaining secure passwords, or had used identity verification questions which were easy for hackers to guess, based on ubiquitous clues from gossip columns and public social media posts.   While we are not too worried about hackers trying to access intimate pictures of our clients, we are definitely concerned about their financial information being stolen.  So we wanted to provide you with what we think are good tips to make your passwords more secure: Read the rest of this entry »

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