News Formal

Volatility and Investment Outlooks: A Reminder of Predictability's Limits

  • 📰 ftenergy
  • ⏱ Reading Time:
  • 23 sec. here
  • 7 min. at publisher
  • 📊 Quality Score:
  • News: 30%
  • Publisher: 63%

Finance Nouvelles

FINANCE,INVESTING,PREDICTION

Man AHL's Russell Korgaonkar highlights the challenges of predicting future investment trends, arguing that volatility scaling, a strategy based on using volatility as a predictor, offers a more practical approach. The article also features a chart comparing implied interest rate forecasts with actual rates, illustrating the difficulty of making accurate predictions, especially about the future.

Judging by his latest “diary of a quant”, Man AHL’s Russell Korgaonkar is as exhausted by the end-of-year investment outlook blizzard as we are. And as he points out, strategists aren’t, umm, great at predicting the future. Man AHL has long been very hot for the idea that volatility is actually the best way to predict the near future and dial up and down your exposure accordingly. It’s the main point of Korgaonkar’s post.

It’s widely used in the trend-following hedge fund space, risk parity and variable annuity products, and forms the basis for value-at-risk models that are virtually everywhere. It has its critics — who argue it embeds automated feedback loops into markets — but it’s true that volatility tends to cluster. It’s equally true that nothing will stop the Wall Street-Industrial Complex from churning out extremely predictable annual investment outlooks.

Nous avons résumé cette actualité afin que vous puissiez la lire rapidement. Si l'actualité vous intéresse, vous pouvez lire le texte intégral ici. Lire la suite:

 /  🏆 47. in FR
 

Merci pour votre commentaire. Votre commentaire sera publié après examen.

France Dernières Nouvelles, France Actualités

Similar News:Vous pouvez également lire des articles d'actualité similaires à celui-ci que nous avons collectés auprès d'autres sources d'information.

A guide to 2025 investment outlooks by someone who hasn’t read themWell the years start comin’ and they don’t stop comin’
La source: ftenergy - 🏆 47. / 63 Lire la suite »

U.S. Drilling Activity Slips Further As Market Volatility RemainsThe total number of active drilling rigs for oil and gas in the United States fell again this week, according to new data that Baker Hughes published on Friday
La source: OilandEnergy - 🏆 34. / 68 Lire la suite »