Beta: Difference between revisions

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10 bytes added , 13 June 2019

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-So-so. Ordinary. Unspectacular. Safe. Dull. Meets expectations. Won’t try to rip you off.
+{{a|glossary|}}So-so. Ordinary. Unspectacular. Safe. Dull. Meets expectations. Won’t try to rip you off.
 Defined in a famous paper by William Sharpe in 1964 — he of the [[Sharpe ratio]] — [[beta]] is defined as
-{{box|“a portfolio risk that cannot be diversified away by adding more securities to it.” }}
+''“a portfolio risk that cannot be diversified away by adding more securities to it.”''
-Since the whole market has all the securities in it, you can’t add to that, the whole market has a beta of 1. Therefore to track [[beta]] is to track the whole market’s performance.
+Since the whole market has all the securities in it, you can’t add to that, the whole market has a beta of 1. Therefore, to track [[beta]] is to track the whole market’s performance. Therefore watch out for — well, to put not to fine a point on it — ''bullshit'' products claiming to yield returns like “[[intelligent beta]]”; “[[smart beta]]” or “[[enhanced beta]]”. Nonsense on stilts.
-Therefore watch out for — well, to put not to fine a point on it — ''bullshit'' products claiming to yield returns like “[[intelligent beta]]”; “[[smart beta]]” or “[[enhanced beta]]”. Nonsense on stilts.
 Good article [https://portfoliosolutions.com/latest-learnings/blog/no-such-thing-better-beta here].
 {{Greeks}}