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Ex-TMFer Shannon Zimmerman, writing for Morningstar, rebuts the conventional wisdom that higher returns are driven by higher risk:

'On average, high-beta investments--those whose prices have swung wider than an index over a given period of time--have historically generated worse returns than less-volatile alternatives.

The pattern has been persistent. A study that appeared last year in the CFA Institute's Financial Analysts Journal found that between 1968 and 2008, a portfolio comprising the least-volatile quintile of the market's 1000 largest stocks swamped the most-volatile quintile over the course of 40 years. And in a 2011 paper by Lasse Pedersen and Andrea Frazzini, the duo find better risk-adjusted returns resulting from "betting against beta" across a broad range of asset types and geographic boundaries over a 50-year time frame.'

Of course, volatility is merely one component of risk, but it sure is good to know relatively 'boring' stocks aren't laggards when it comes to long term competitive returns. Hare and tortoise redux?
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