Dr. George Athanassakos gave a virtual presentation, titled “Risk Management”, to Veritas Investment Research Corporation for their Fact-Finding Video Series.
Dr. Athanassakos and Host Anthony Scilipoti covered:
- How to evaluate systematic and non-systematic risk.
- Why value investors reject tenets of modern portfolio theory.
- Portfolio diversification: “Diversification fails you when you need it most.”
- Measuring risk: “The problem is that risk in real life does not look like a game of roulette. The return distribution curve does not look like a bell curve. Our world is more like a poker game when whatever we observe around us affects the odds.”
- What do value investors want? “For value investors, avoiding losses is the key. They would rather minimize risk than maximize returns.”
- Why so many investors underperform the market: “Portfolio managers underperform not because they lack stock picking ability but rather because institutional factors force them to over diversify”.
- Advice to (new) professionals: “Never start your analysis with spreadsheets and formulae because this shows that you do not understand what is happening and you are trying to hide behind the formulae.”
Watch the replay (members only): Fact-Finding Video 89: Risk Management: Contrasting Modern Portfolio Theory and Value Investing – With Dr. George Athanassakos
