UnThreaded | Threaded | Whole Thread (9) | Ignore Thread Prev | Next
Author: TheNajdorfDefens Big funky green star, 20000 posts Feste Award Nominee! Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 41627  
Subject: Re: Breaking Radio Silence (Part II) Date: 6/27/2006 2:23 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 1
1. THE RISK/REWARD TRADEOFF

Efficient Market Theory tells us that higher returns can only be achieved by assuming higher levels of risk.


I believe Markowitz' Nobel-winning Portfolio Theory proved that higher returns can come with lower risk in a diversified portfolio.

Perhaps you are talking about when one's portfolio is already on the Efficient Frontier? At that point, one needs to take on more risk to add return according to academic theory.

However, I doubt most people on this board, or any TMF board, are on the efficent frontier, so I doubt EMT applies in this case.

Not that I believe in efficient markets anyway...:)

Naj
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (9) | Ignore Thread Prev | Next

Announcements

BMW METHOD EVENTS

The 2009 BMW Method Conference has been cancelled, due to minimum attendance numbers not being met. We hope to continue the annual BMW Method Conference tradition next fall.

Learn about the first four conferences on the BMW Method Website.

The BMW Method FAQ

BMW Method Website
Annual Conference Videos and Other Resources & Services
Post of the Day:
Macro Economics

U.S. Stable, Europe Stalling
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement