Are US mutual fund managers idiots?

Discussion in 'Wall St. News' started by ASusilovic, Sep 21, 2011.

  1. If you understand this:

    In finance, the capital asset pricing model (CAPM) is used to determine a theoretically appropriate required rate of return of an asset, if that asset is to be added to an already well-diversified portfolio, given that asset's non-diversifiable risk. The model takes into account the asset's sensitivity to non-diversifiable risk (also known as systematic risk or market risk), often represented by the quantity beta (β) in the financial industry, as well as the expected return of the market and the expected return of a theoretical risk-free asset.

    The model was introduced by Jack Treynor (1961, 1962),[1] William Sharpe (1964), John Lintner (1965a,b) and Jan Mossin (1966) independently, building on the earlier work of Harry Markowitz on diversification and modern portfolio theory. Sharpe, Markowitz and Merton Miller jointly received the Nobel Memorial Prize in Economics for this contribution to the field of financial economics.

    You will understand my question.
  2. simple question- simple answer " yes"
  3. and dont belive the nobel peace winner-Obama got it ( according to the press )- so makes a mockery of it all..
  4. is stalin still alive? I have no idea as ner seen his body- or bin laden? si impossible to verify
  5. or saddam hussain- he could be on the run- just rely on the media- I have never veriefied his body- so how knows? could be all political?
  6. Eight


    I don't understand the question.. But I understand that few fund managers beat the indexes.
  7. How can it be any different?
  8. For starters, the use of "beta" as some sort of fundamental metric to gauge "systemic risk" is patently absurd.
  9. ashatet


    No the fund managers are smart. They get to play with OPM. They are partners in the winnings and have no fault when they lose.

    It is the investors who are idiots to buy these funds.
  10. exaclty, better ask the question:
    are the mutual funds investors idiots?
    #10     Sep 22, 2011