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Let's think about this: a good and free example

WWB states it's bias in favor of beta driven returns and longer term asset allocations (i.e. construct portfolios of various asset classes and execute through low cost indexed product). Of course, this approach is based on a variety of assumptions, and it is certainly possible, if not probable, that some assumptions vary as to degrees of reliability or confidence over time and circumstance.

We do not live or invest in a perfect world.  There are limits to information and analytic & computational capacity, and it is unlikely that any retail or small institutional investors are anywhere near them. We would argue that most medium to large institutions are nowhere near them.

Here's a good and free example  of the lower end of what's available. Here Google Domestic Trends charts the number of web inquiries against DAL.  We stipulate it's pretty cool, but bear in mind this is so primitive, its free ... the lowest grade of analytics available. And what you do with this is not clear: do rising inquiries foretell more passenger/miles? Or a change in consumer elasticity providing less revenue/mile/passenger? Does cancer cause smoking or vice versa?

I recall a hedge fund manager once showing me a similiar chart of entirely different variables. He closed his presentation with "It's a no brainer. I can trade that. Anyone can trade that."  Perhaps, but nevertheless we declined to pay him for the priviledge of testing his hypothesis with our money and granting fees that vested as his call option with asymetrical treatment of our downside risk (heads I win, tails you lose). 

The next time you want to buy an individual security, think about this example, but extend it to every asset class and security around the globe and do it on a real time basis. What do you know that everybody else doesn't? If you don't have a good, hard, and legal answer to that question, you'd better worry about the converse.

As one of our associates commented in a strategy discussion as to the state of analytics and theory, "Look we know that Newtonian physics don't work all the time, but it's pretty tough to build a bridge without them."  And we are looking to build bridges, if not bombshelters, across which we, our families, and clients, can walk.

Lastly, who do you think has better information? Google or the Fed? Hmmm....

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