Why not invest 100% in these supposedly higher-return, lower-risk funds?
But in any business struggling for energy and capital, energy efficiency is often the highest-return, lowest-risk investment available, limited less by technology or economics than by culture and imagination.
One reason, argues Ian Maxwell of Schroder Salomon Smith Barney, an investment bank, is that only the biggest firms can afford to get over the high barriers to entry in the high-return, low-risk niches of the mining business: iron ore, alumina, diamonds and industrial minerals.
But that return should be risk-adjusted, that is, a return in line with the risk one assumes in seeking it.
Furthermore, this long-term return, high risk, engineering-lead venture, was financed by - wait for it - the City.
But he ignores the fact that savers are incurring permanent losses by being deprived of normal rates of return on risk-free assets.
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What they are giving you is generally going to be asset categories, unless they have the specific return-and-risk parameters for every security in the portfolio.
Twenty percent of the levy is reflected in normal returns (essentially, equal to the return from low-risk bonds) and 60 percent in any additional returns received by shareholders.
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Taking Greek junk bonds in return for risk-free Bundesbank ones.
By bending the risk-return curve, investors can adjust to the fundamental market environment and tailor their risk exposure for more consistent long-term investing.
Sheldon Jacobs , editor of The No-Load Fund Investor, has a ten-year risk-adjusted return that puts him among the top five fund letters, according to Hulbert.
Using a weighted score based on one-year total return, five-year total return, and five-year Sharpe ratios (a risk-adjusted measure of performance), we chose funds that outperformed their peers in core investment specialties such as: global equities, Europe, Japan, U.S., small companies, and more.
Santander has staffed its Latin American operations with its own credit-risk specialists, who veto any loan that offers less than a risk-adjusted return of 20% a year.
And because they have zero expected return, they are inferior to the rate of risk-free return.
Our research consistently demonstrates that short-term (five year maturity or less) paper has historically a much better risk-return tradeoff than long-term bonds.
The return on such high-risk, often illiquid investments can be great when the market is going great.
The characteristics of an equity portfolio can be customized to complement an overall asset allocation strategy in meeting long-term return and risk objectives.
The PIMCO Total Return Exchange-Traded Fund (BOND) is a diversified portfolio of high quality bonds that is actively managed in an effort to maximize return in a risk-controlled framework.
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And so, arguably, three, four, five years ago people became unmoored from their long-term risk tolerances and became purely return-seeking and, now, I think, are in more cases, frankly, being more thoughtful about their capacity to absorb losses.
The questions on the energy question, which is never far from the economic part of the independence debate, are how you assess both risk and return, and how much appetite for risk - both downside and upside - Scottish voters will have when they vote in September next year.
By selecting the best returns, we stimulate those companies to optimise their own risk-return balance.
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Last week we looked at several asset categories and placed them on the risk-return chart.
The report found strong evidence that involvement of financial advisors results in inferior risk-return trade-offs, as measured by the Sharpe ratio, regardless of advisory model.
These are unsecured debt issues that also bend the risk-return curve.
Options are one effective way of bending the risk-return curve.
Now, certainly this disaster did not do the shareholders of BP much good, but the point is that, in financial terms, there is an optimal risk-return trade-off to be made.
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And, as said, that implies making risk-return trade-offs.
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Individual investors select shares with the highest return and track record, consumers select the bank with the best rates, your pension fund invests your savings in companies with the highest risk-return trade-off, and so on.
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