Investment Management
In the investment philosophy we subscribe to, science trumps fad. It rests on some simple ideas that are nontheless powerful enough to have garnered a Nobel prize in 1990.
Firstly, risk and return are related: increasing expected return increases risk. Secondly, diversification helps distinguish those risks that are worth taking - because there are economic reasons investors will be compensated - from those that are not. Thirdly, active management - trying to predict the future and then speculating by picking stocks or managers - is futile and expensive, incurring costs in trade impact, taxes and expenses. Traditional passive management (strict indexing where you trade to closely mirror the benchmarked index) also involves excessive and expensive trading.
Finally, investing is different from speculating. An investor, in the true sense of the word, has a purpose and function: by providing capital, the investor actively supports those companies who are contributing to a healthy economy, both here and globally.
