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A smoother ride? Looking at factor-based asset allocation 

Strategic asset allocation has been an important driver of multi-asset-class portfolios’ returns.Traditionally, many investors have followed a holdings-based approach — where decisions are based on asset-class weights in the portfolio. On the surface, this appears to produce a stable allocation, but is what you see always what you get? In our example below, a factor-based approach resulted in less fluctuation in risk contributions and total portfolio risk than a holdings-based approach.

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Speed bump or regime shift? Deconstructing the recent spike in equity market volatility 

The week of Feb. 5 witnessed a return of market volatility not seen since the days of the euro crisis in 2011. After hovering near 10% for most of the past year, the level of the VIX briefly topped 50%. What caused the spike?