Tag: diversification (Page 1 of 5)
Failure to meet your financial objectives can take one of two forms: fast failure and slow failure. Failing fast involves suffering large losses at the wrong time as the result of taking too much risk. Failing slow involves achieving insufficient growth due to taking too little risk.
March Madness competitions with non-standard rules have many parallels to investing. Diversification, model development, backtesting, and evaluating assumptions all come into play.
In theory, investors should gear the most risk-efficient portfolio; in practice, few do. Portable beta may help investors create more efficient portfolios.
A robust portfolio is better than an optimal one. Mitigating the risk of incorrect capital market assumptions is important in mean variance optimization.
Benchmarking, Behavioral Biases, and the March Madness Tournament Challenge Recap
By Nathan Faber
On April 16, 2018