International Investing: Managing Multiple Layers of Alpha

Jul 1, 2007

Frequently investors have much more information than they can possibly digest. Developing and employing efficient information processing machinery to handle large amounts of data in a consistent way is the key to success in this environment. In this article we argue that it is critical for international equity asset managers to organize information according to its scope. The structure outlined here categorizes information into three types--global, local, and asset-specific. While we confine ourselves to these three types for illustration purposes, the model is readily expandable to other types of information. Other asset classes can be introduced as well.