Lost in the shuffle last week was this fascinating discussion at Morningstar about a new way to judge and evaluate the relative success of one’s retirement portfolio – not through the traditional lens of alpha and beta…
From Morningstar:
The benefits from “good” financial-planning decisions are difficult to quantify. For any given portfolio, investment decisions generally can be decomposed into two primary components: beta and alpha. Beta can be defined as the systematic risk exposures of the portfolio (usually achieved through asset allocation), and alpha is the residual (skill or luck-based) component associated with the various flavors of active management, such as tactical asset allocation, security selection, and more. Alpha and beta are at the heart of traditional performance analysis; however, their impact on a successful retirement can be far less important than other financial- planning decisions.
In this article, we introduce a concept called “Gamma,” which is designed to measure the additional expected retirement income achieved by an individual investor making intelligent financial-planning decisions. Gamma is the third letter in the Greek alphabet (preceded by alpha and beta), and within financial economics, it is sometimes used as the variable denoting an investor’s degree of risk aversion. Given that Gamma is relatively unclaimed within financial literature, we seek to give it new meaning.
Keep Reading:
shopping 3.0
[…]usually posts some really fascinating stuff like this. If you are new to this site[…]
beauty and health investment group
[…]that is the finish of this article. Here youll come across some internet sites that we believe youll value, just click the links over[…]
business finance chapter 6
[…]Sites of interest we’ve a link to[…]
small business 401k
[…]just beneath, are various completely not connected internet sites to ours, nevertheless, they are surely worth going over[…]
education journals
[…]Wonderful story, reckoned we could combine some unrelated data, nonetheless truly really worth taking a look, whoa did a single master about Mid East has got much more problerms too […]
food you can only get in seattle
[…]that could be the finish of this article. Here you will find some web pages that we think you will enjoy, just click the hyperlinks over[…]
rampant rabbit vibrator
[…]here are some hyperlinks to web-sites that we link to simply because we believe they’re worth visiting[…]
fashion usa online
[…]although web sites we backlink to beneath are considerably not associated to ours, we feel they are truly really worth a go by way of, so have a look[…]
life insurance physical
[…]please visit the web sites we follow, including this one particular, because it represents our picks in the web[…]
health f(x)
[…]The data talked about in the post are a few of the best available […]
health hacks
[…]Here is an excellent Blog You may Locate Interesting that we Encourage You[…]
c program for traveling salesperson problem
[…]although internet websites we backlink to below are considerably not connected to ours, we really feel they may be essentially worth a go by way of, so have a look[…]
home decor youtube videos
[…]below you will discover the link to some sites that we feel you must visit[…]
n carolina real estate
[…]Wonderful story, reckoned we could combine several unrelated data, nevertheless really really worth taking a look, whoa did one learn about Mid East has got a lot more problerms as well […]
home renovation loan calculator
[…]check beneath, are some completely unrelated web sites to ours, however, they may be most trustworthy sources that we use[…]