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It would be fair to say that this book contains all that is presently known about expected returns. Expected returns represent the central question for any investor, making this book a cornerstone for practitioner and academic alike.
There are many strengths; firstly the book is bang up to date with the latest literature, including commentary on the 2007/ 08 credit crunch. Secondly it covers all asset classes ranging from stock, bonds through to alternatives. Thirdly it is as international as the literature enables, there is still a massive bias to the US but this is inevitable given that this is where almost all the research is carried out. Finally the author has an unwavering grasp of the subject and is an authority in this area.
It must be emphasised however that the book is really a textbook in nature and is heavy going from page 1. Expect to have to read it several times and keep referring back to it. It is not a light read and does presume some prior knowledge. If you do not have a degree from business school you may be better off starting on an easier book because you are unlikely to understand more than half of the content.
Overall it is an impressive feat of scholarship and a massive contribution to this area of study.
I expect the writer is quite smart who has a good grasp of a very large body of work in the field of finance. However, from reading it I got the sense that demonstrating this fact became his overriding goal and as a research piece which provides a precis of finance literature, it is quite good. As a useful guide for making investment decisions, I found it less helpful.
Ilmanen promises much in the introduction and to large extent he delivers. The work will prove to be a worthwhile reference book for any multi-asset professional investor and possibly beyond. The book provides a valuable collection of long term historic return data across numerous asset and sub-asset classes. Ilmanen's provides insight to interpreting these as well as assessing the robustness and reliability of the data. He continually highlights the value of assets which have low or negative correlations but stresses that the value of these assets depend upon the correlations remaining robust during times of market distress. Tucked away within the book are some key answers to some burning issues, for example Ilmanen considers the appropriate asset class for periods of climbing inflation - this alone should justify buying the book.
However, the work is not without its faults. Ilmanen introduces some ponderous 'visual aids' (the cube & elephant). Neither is visually appealing nor helpful to the reader. Dropping them would improve the clarity of the book.