Overview

How can portfolio managers prepare for tail risks when historical data, quantitative models, and traditional diversification may offer an incomplete picture? 

In this episode of Conversations with Frank Fabozzi, CFA, Til Schuermann examines how portfolio managers can navigate an increasingly uncertain and interconnected risk environment. Drawing on his experience as Partner and Global Head of Finance and Risk at Oliver Wyman and his previous work at the Federal Reserve Bank of New York, he explores stress testing, model risk, liquidity, private credit, regulation, and the vulnerabilities that can emerge during periods of market disruption. 

The discussion will consider how investment professionals can challenge assumptions, identify hidden exposures, and strengthen portfolio resilience when markets behave in ways that historical models may not anticipate. 

Key discussion points 

• Preparing for a new risk environment: Explore how geopolitical instability, economic fragmentation, inflation, climate risk, and technological disruption can increase tail risk and challenge traditional diversification. 
• Stress testing portfolio vulnerabilities: Examine how practical scenarios can uncover hidden exposures, test assumptions, and inform hedging and asset allocation decisions. 
• Avoiding “model on, brain off”: Consider why portfolio managers need to remain skeptical of quantitative models, particularly during market shocks and regime changes. 
• Model governance in the age of AI: Explore the importance of separating model development from validation and strengthening post-deployment monitoring for complex AI systems. 
• Liquidity risk and private credit: Understand how ostensibly liquid assets can behave during periods of stress and how limited transparency can conceal concentration risks. 
• Systemic risk and financial resilience: Examine how regulatory stress tests, government debt, constrained fiscal capacity, and geopolitical shocks can influence portfolio risks and market behavior. 

This webinar is worth 1 PL credit. If you are a CFA Institute member and attended live or watched the recording on your own time, you may self-report this activity in your tracker.

Speakers

Date and Time