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June 2, 2015

New Releases: The Aspirational Investor

By: Dylan Schleicher @ 8:15 AM – Filed under: Current Events & Public Affairs

AspirationalinvestorInvesting is the way we participate in the growth of the world. But markets are unpredictable and even broadly diversified portfolios can experience extreme volatility. Markets can crash; they don’t care about individual investors’ needs. In The Aspirational Investor: Taming the Markets to Achieve Your Life’s Goals (HarperBusiness, $29.99 Hardcover; ISBN 13: 9780062235091; on-sale: June 2nd, 2015), Merrill Lynch Chief Investment Officer Ashvin B. Chhabra describes an important evolution in wealth management theory—an entirely new approach to managing wealth that he calls the Wealth Allocation Framework. This Framework builds on thinking from Modern Portfolio Theory with insights of behavioral finance, resulting in an investment approach centered on goals, not markets, and the careful allocation of risks.
 
By shifting the focus from the market at the center to the investor and their life priorities, Chhabra accommodates three seemingly incompatible objectives that must underpin every sound wealth-management plan:
 
  • The need for financial security in the face of known and unknowable risks
  • The need to maintain current living standards over time despite inflation
  • The need to pursue aspirational goals for wealth creation and impact
 
It accomplishes this by helping individuals consider their total wealth and connects this view of their personal balance sheet with a plan aligned to their goals.
 
By exploring the investment strategies of successful funds like the Yale and Harvard endowments and comparing them to other models of investing, Chhabra shows how each investor needs their own strategy for approaching the market to account for their needs. Strategically utilizing visual tools and clear and concise language, The Aspirational Investor ensures that the financial concepts within are understandable by all.
 
In a fast-paced and changing marketplace, it can be easy to get tied up in chasing the next big stock, bond, or hedge fund. Chhabra reveals some surprising facts about wealth creation, reinterprets the success formulas of investing greats like Warren Buffet, and closes the gap between theory and practice by simplifying our understanding of key asset classes and laying out a concise road map for identifying, prioritizing and quantifying financial goals.  Ashvin Chhabra helps remind us to focus on an essential question: What do you want your wealth to do for you?
 

ABOUT THE AUTHOR

Ashvin B. Chhabra is the chief investment officer of Merrill Lynch Wealth Management. He has also served as the chief investment officer at the Institute for Advanced Study at Princeton, where he managed its endowment. He is widely recognized as one of the founders of Goals-Based Wealth Management and for his seminal work “Beyond Markowitz.” Ashvin grew up in New Delhi and was trained as a theoretical physicist. He received a PhD in applied physics from Yale University in the field of chaos theory. He lives in Princeton, New Jersey.
 
With The Aspirational Investor, Chhabra raises the bar for what we should expect from our investment portfolios and the advisors who manage them.





About Dylan Schleicher


Dylan Schleicher has been a part of the 800-CEO-READ claque since 2003. Even though he's stayed on at the company, he has not stayed put. After beginning in shipping & receiving, he joined customer service and accounting before moving into his current, highly elliptical orbit of duties overseeing the ChangeThis and In the Books websites, the company's annual review of books and in-house design. He lives with his wife and two children in the Washington Heights neighborhood on Milwaukee's West Side.