Why are financial professionals more likely to embrace behavioral finance and how can this help the average investor?
Tag "Modern Portfolio Theory"
The GOT system offers a viable and practical alternative to relying on outdated MPT tools. Although still widely in use, MPT-based calculators and analyzers can sometimes lead retirement savers to make decisions that aren’t in their best interest. That statement alone should trigger concerns from the mindful fiduciary.
So one wants his epitaph to read “Here lies John Doe. He beat the S&P 500.” There needs to be an easy-to-understand and easy-to-implement system that properly reflects both your goals and the consequences of failing to meet those goals. Retirement savers want and need a system that represents a better way to set and meet retirement goals.
Many professionals and most of the current generation of finance professors have long ago removed “risk” from their investment decision-making algorithms. These forward-thinking folks recognize the greater importance of managing retirement saver behavior over managing irrelevant investment risk as it pertains to meeting or exceeding the goal of retiring in comfort.
Compliance craziness, Fiduciary Rule rising, and tossing MPT (and Indexing, too?).
Investing through mutual funds, including TDFs, is like using mass transportation. It’s not ideal but for many it’s the only realistic choice.
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State Run Plans DOA? Fiduciary’s Long Goodbye? and Products Trump Investments?
What if I told you that something vital to top business schools, the financial services industry, your business and your clients’ success and satisfaction doesn’t work as advertised?
The evolution towards more effective retirement planning is already underway, and many fiduciaries are breathing a sigh of relief because of it.
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New thinking, delay of game, and moving (too far?) ahead.