Monthly Archives: June 2018

Revisiting Risk and Reward (Part 3)

A previous blog article explored income-centric risk and reward definitions, which could be viewed as more suitable to retirement than the usual academic definitions. Corresponding quantitative analysis of some simple US portfolios was provided. A follow-up article explored the perspective of retirees located outside the US.

This article extends this investigation by exploring in more technical depth the tie-in between Safe Withdrawal Rates (SWR) and variable withdrawal methods, through the use of a clever metric named Withdrawal Efficiency Rate (WER). 

Posted in Asset allocation, Market history, Market statistics, Portfolios

Revisiting Risk and Reward (Part 2)

A previous blog article explored income-centric risk and reward definitions, more suitable to retirement than the usual academic definitions. Corresponding quantitative analysis of some simple US portfolios was provided.

This article extends this investigation by taking the perspective of investors located in various developed countries (a form of ‘out of sample’ testing).

Posted in Asset allocation, international stocks, Market history, Market statistics, Portfolios, Retirement

Revisiting Risk and Reward

Financial literature from academics has been strongly influenced by the ground-breaking work of Harry Markowitz and William Sharpe, and the concept of risk & reward for a multi-asset portfolio. Although brilliantly innovative, this work is often misused, equating risk with (portfolio) volatility and reward with (portfolio) returns, and applying such principles without acknowledging the fundamental differences between investors and speculators, or accumulators and retirees.

This article will explore risk and reward from a perspective more suitable to retirement, and perform corresponding quantitative analysis of some simple portfolios.

Posted in Asset allocation, Market history, Market statistics, Portfolios, Retirement, Value premium

Interview with Taylor Larimore: Taylor’s investment journey

Taylor Larimore, affectionately known as “the dean of the Bogleheads,” has been an investor for over seven decades. Recently we asked Taylor a few questions that trace his evolution as an investor. Financial Page: Thanks Taylor. We would be interested

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Posted in Bogleheads
June 2018
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