You have to stay close to the underlying asset in order to take advantage of the returns of that asset.
Li notes that more than half the people who purchase shares in Cathay and Shinkong do so as hidden asset plays to take advantage of the companies' large holdings in real estate.
In this view, human capital is treated as an accumulative resource that benefits the organization like any other business asset, providing competitive advantage through a transformation of the unique capabilities of individual employees to superior organizational performance.
Handing over an annual fee of 1-2%, plus a 20% performance fee, to an alternative-asset manager throws away that advantage.
Assume for example that real estate has a relative advantage over other asset classes or a superior return potential over the long term.
He is a volatility arbitrage specialist who trades volatility as an asset class in an effort to take advantage of inefficiencies in the options markets.
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Investors with a balanced asset allocation and the discipline to rebalance have the added advantage of systematically selling stocks into strength and buying into weakness.
The great advantage here is that the donor can get rid of an asset without taking a 20% capital gains hit.
The unspoken advantage of diversification is that it increases the odds of being in the right asset class at the right time.
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With its asset-light, debt-free business model, the transport and logistics company is taking advantage of lower costs and prices, buying up businesses and stretching its reach to become the premier courier service linking the emerging and fast growing Asian and African economies.
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