Take More Risk For More Investment Returns?

The Financial Analysts Journal recently reported a study made about the ability of added investment risk to produce more returns. Many investors have the impression that high risk spells more profits down the road.

The study showed otherwise: Over 41 years, through 2008, lower-risk stocks actually performed better than higher risk types. This was not supposed to be the case, according to prevailing theoretical mathematical risk models.

Diversification of risk and avoidance of real speculation would be a solution. (See the Earl J. Weinreb NewsHole® comments.)