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May 11, 2016 @ 11:00 am - 1:00 pm
Redefining Investment Advice
Understand the simple but powerful forces shaping the behavior of capital markets all over the world.
Weston Wellington, Vice President, Dimensional Fund Advisors
There is a new model of investing: a model based not on speculation but on the science of capital markets. Decades of research guide the way.
Markets throughout the world have a history of rewarding investors for the capital they supply. Companies compete with each other for investment capital and millions of investors compete with each other to find the most attractive returns. This competition quickly drives prices to fair value, ensuring that no investor can expect greater returns without bearing greater risks.
Traditional managers strive to beat the market by taking advantage of pricing “mistakes” and attempting to predict the future. Too often, this proves costly and futile. Predictions go awry and managers miss the strong returns that markets provide by holding the wrong stocks at the wrong time. Meanwhile, market economies thrive because they direct scarce resources to their most effective use.
The futility of speculation is good news for the investor. It means that prices for public securities are fair and that persistent differences in average portfolio returns are explained by differences in average risk. It is certainly possible to outperform markets, but not without accepting increased risk.
When you reject costly speculation and guesswork, investing becomes a matter of identifying the risks that bear compensation and choosing how much of these risks to accept. Financial science identifies the sources of investment returns.
What is this science? Who developed it? Why does it work? How should it be put to use?
Weston Wellington explains why every investor needs to hear this story.
RSVP by May 6, 2016
Stueckle Sky Center, Double R Ranch Club Room
Lunch will be provided. Lunch is served at 11:00 a.m. Speakers will begin promptly at 11:30 a.m.
1.5 CPE and CLE intermediate level credit hours are anticipated.
Field of Study: Investment Management