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Corey Hoffstein

Co - Founder, Chief Investment Officer and Portfolio Manager, Newfound Research

Oct 7, 2014

What is risk anyway?

Through some simplifying assumptions, modern portfolio theory equates risk with volatility. In many cases, it is a “good enough” approximation: higher volatility indicates a greater probability of larger realized losses. But it also indicates a greater probability of larger realized gains. Most investors, however, are risk averse, meaning they are willing to give up some…

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