Long-time Framework member, Carey C. sent in a question that Joe and I found really thought provoking. Most of the companies at which we have looked recently seem overvalued. If we’re right about the overvaluation, how should someone invest?
Joe pulled together a presentation and we had a good discussion about this question in our March 9, 2018 Office Hour session with members R.G. and Robert Ruggirello, CFA, and with member and partner Sheila Chesney.
Joe and I found it interesting that everyone on the call was looking toward other asset classes — alternatives, real estate, emerging markets — to find value these days. Here is our presentation and a recording of the excellent discussion!
Introduction & Agenda
Here, Joe lays out why we’re talking about this and how we will go about it.
Market Valuation Review
Depending on what measure one looks at, the market seems overvalued. Joe reviews a few of the things he’s been watching.
Using Alternatives and a Long Time Horizon to Reduce Risk
Sheila talks about her approach to portfolio construction, which allows her to stay invested when public markets are toppy.
Disciplined Strategic Allocation & Real Assets to Reduce Risk
Robert talks about his firm’s rules for strategically allocating capital and focusing part of the portfolio on real assets to reduce risk.
Wary of an Overheated Market, Searching for Value in Microcaps and Overseas
R.G. mentions a few measures of overheating that we had missed, and discusses his strategy for finding value in this market.
An Overview of Market, Economic, and Geopolitical Risks
Joe walks through what we see as some of the most important risks and uncertainties confronting investors today.
Interest Rates and REITs
Robert talks about whether or not it’s worth it to be worried about owning REITs in a rising rate environment — one of the economic risks we highlighted.
Watchlists and Ideas
We finish up the discussion talking about what is on our watchlists and on a few interesting investment ideas.