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We live in a world in which
volatility is the norm rather than the exception. An investor's goal is to
achieve the highest possible return with the lowest possible level of risk.
Unfortunately, the nature of investment markets is such that the risk-return
relationship is, for the most part, positively correlated a higher return
will have a higher associated risk. So, by taking an additional risk in a
portfolio, an investor should be compensated with higher returns.
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Investment Solutions, in
alliance with its global partner Russell, has
developed a more efficient way to structure
portfolios, making it possible to control risk
without necessarily giving up returns, i.e.
diversification for risk control and consistent
above-average performance. The diagram above
illustrates the point graphically. It shows a
reversal of the typical risk/return relationship.
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