The Outperformance

Amar Pandit , CFA , CFP

May 20, 2022 | 2 Minute Read

Last week, I wrote “14 Words to understand Risk”. Just continuing that train of thought in this Nano.

Safety is a myth.

We feel safe when there is no volatility in an investment. Thus, we outperform on the Volatility front. We however underperform on the returns front.

When you suppress volatility, you suppress returns.

When you eliminate volatility, all you get is Return Free Risk.

The choice as always is yours – Outperform in Volatility and Underperform in Returns or Underperform in Volatility and Outperform in Returns.

What do you prefer?