But would you believe that that method is actually high risk and typically leads to less
than desirable returns?
Not exact matches
There are obvious reasons the industry has had less -
than -
desirable returns, including: massive over-funding of the sector, huge increases in inexperienced venture capitalists that took a decade to peter out, and the massive correction in the value of the public stock markets that closed many exit opportunities for half a decade.
In this article I show that very basic quantitative trading strategies that generate
returns from different market behaviours, when combined, can provide a more
desirable and stable
returns stream, as reflected in a Sharpe ratio higher
than any individual strategy.
An additional risk is if the mutual fund invests that money in something less
than desirable to juice
returns.
Indeed, the logic of skewed
returns is that it is more sensible to focus on excluding the least
desirable stocks
than on picking the most
desirable — the opposite of what a concentrated portfolio will do.
If there's not an attractive place to put the money, it will eaither sit in cash or be invested in less -
than -
desirable alternatives which will drag down
returns.
While the PASS result is
desirable — how much more should the portfolio
return be
than the inflation rate?
This is particularly
desirable since many business owners write off a lot of expenses and might make / need more money
than their tax
return shows.
The longer -
than - expected financial dislocation and deteriorating economy, while not
desirable, could ultimately enhance
returns, Dougherty suggests.