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Wealth Management Expert

Peter Mladina

Director of Portfolio Research, Wealth Management

Peter Mladina is the Director of Portfolio Research for Northern Trust Wealth Management. He is responsible for the application of leading research to the wealth management investment process. This includes research, tools and methods that support asset allocation, portfolio construction, investment selection and best practices in portfolio management.

Previously, Mr. Mladina was the Director of Research at Waterline, a boutique wealth manager acquired by Northern Trust in 2010. In addition to advising high-net-worth clients, Mr. Mladina helped Waterline develop an innovative goals-based asset allocation solution and an empirical investment approach rooted in academic research.

Mr. Mladina is an Adjunct Professor of Economics at UCLA, where he teaches applied finance for the Master of Applied Economics program. His research on asset allocation and portfolio construction has been awarded publication in peer-reviewed journals, and he is a co-author of the CFA Institute’s revised Level III asset allocation curriculum. He received a BA in Economics from UCLA and an MBA from Edinburgh Business School (UK).


Peter's Insights & Research

Investors commonly view cash, as represented by Treasury bills, as the risk-free asset. Over multi-year time horizons, Treasury bills are exposed to reinvestment risk (interest rate risk) and some inflation risk. They are not truly risk-free.

In January 2016 we published the research article “Is There Value in the Value Premium.” At the time, value stocks (Russell 3000 Value index) had underperformed growth stocks (Russell 3000 Growth index) by 4.1% annualized since 2009, and investors were questioning whether a value tilt was beneficial to their portfolio. Fast forward to July of 2020 and the underperformance has fallen to 7.2%.

An evaluation of the efficacy of the annual rebalancing frequency relative to other common approaches.

Portfolio risk and shortfall risk provide a more complete view of risk to help investors select portfolios.

Investors commonly view cash, as represented by Treasury bills, as the risk-free asset. Over multi-year time horizons, Treasury bills are exposed to reinvestment risk (interest rate risk) and some inflation risk. They are not truly risk-free.

Investment products that align with investors' views on environmental, social, and governance issues are increasing in popularity.

Insights and guidance on asset location and withdrawal sequencing to improve portfolio allocations.

Behavioral biases and low cost bases cause many investors to maintain exposure to concentrated stock positions. But investors holding such concentrations may be underestimating the idiosyncratic risk of individual stocks and overvaluing the benefit of avoiding the capital gains tax.

A comparison of the after-tax return and risk benefits of state-specific vs. nationally-diversified municipal bonds.

Real assets (real estate, infrastructure and natural resources) are intended to improve a portfolio's diversification and protect against unexpected inflation. But are they an effective inflation hedge? And if so, which are the most reliable?

A hedge fund allocation can provide diversification benefits to stock/bond portfolios. But you have to be highly selective.

Investors sometimes choose to reach for yield within their safe fixed income allocation. This practice can be suboptimal, because it can sacrifice portfolio diversification and related total return benefits.

There are many definitions of risk, but running out of money too soon is perhaps the most tangible one. How should investors consider shortfall risk when funding high-priority goals?

Asset allocation aligns investment assets with investment objectives. But what is the best benchmark for asset allocation?

Active management is based on the premise that capital markets are inefficient, despite the fact that most active managers under-perform in the market.

Many investors assume that Fed policy affects market interest rates, and changes in market interest rates affect bond returns. But is this relationship empirically true?

Many investors assume that higher GDP growth translates to higher company earnings, which in turn results in higher equity returns. But is this relationship empirically true?

Municipal bonds dominate the fixed-income portfolios of most high-net-worth investors, featuring a tax-exempt status that holds greater appeal for private investors than other bond market sectors.

Classical economics assumes individuals make rational choices, but human behavior is not always so rational.

Factor-based investing requires a long-term view. But research shows that when it comes to the value premium, it’s worth being patient.

Rather than get upset by market volatility, long-term investors should focus on what they can control: asset allocation, value for expense and tax efficiency.

Should investors worry about hedging foreign currency risk for their global portfolio allocations? It depends, in large part, on their goals.

Are markets really efficient, eliminating any opportunity to earn excess return, or can skilled investment managers capture risk-adjusted excess return (alpha)? If so, how can you identify these managers?

Gross returns grab the headlines, but private investors consume after-tax returns.

For investors on the sidelines, fear of market entry can be paralyzing. But by holding excess cash, you can lose purchasing power which can interfere with achieving your long-term goals.

In the real world, assets should serve the purpose of funding specific goals. Goals-based asset allocation is designed to better align your portfolio with your goals.

Many investors try to emulate the endowment model of investing in hopes of achieving the same exceptional long-term returns elite universities have seen. But what are the real sources of those returns?

Some investors believe individual bonds are less risky than bond mutual funds, especially in times of rising interest rates. Is this true, or just a myth?

Most U.S.-based investors have a “home bias” or preference for U.S.-based stocks and bonds in their portfolios. This could be exposing them to increased risk.

Factor-based investing is a viable alternative to passive and traditional active equity investing.

Changes in valuation partly forecast future equity returns over the intermediate term.