tag:blogger.com,1999:blog-2568941354104807757.post7883912359385134797..comments2023-10-05T09:07:24.225-04:00Comments on Investment Performance Guy: Topology makes it way into performance and riskDave Spauldinghttp://www.blogger.com/profile/01777929408680234896noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-2568941354104807757.post-45121825781849173342012-02-24T21:50:28.863-05:002012-02-24T21:50:28.863-05:00Steve, I'll take that as an endorsement of my ...Steve, I'll take that as an endorsement of my use of topology and the Mobious strip ... thanks!Dave Spauldinghttps://www.blogger.com/profile/01777929408680234896noreply@blogger.comtag:blogger.com,1999:blog-2568941354104807757.post-21202057997834782032012-02-24T21:25:41.628-05:002012-02-24T21:25:41.628-05:00There's a lot of value in this view of risk an...There's a lot of value in this view of risk and return being on the same side, as opposed to being on opposite sides of a coin. After all, so-called "risk" is the source of return, both in terms of market exposure and an active return. You can't have one without the other. In the statistical sense, risk measurements help to describe the return, and so they are essential to the return. In terms of measures of uncertainty, such as standard deviation, risk sets a reasonable range for potential returns. In this way, it does not distinguish between "good" and "bad" returns (or "upside" vs "downside" events.) That is true to its essential quality as a descriptor of the return. This view is consistent with other ideas which consider a "performance" report that only contains return and no risk to be incomplete.Stephen Campisi, CFAnoreply@blogger.com