It's a challenging environment in which to make money—volatility is high, and returns are sideways to low. As investors proceed, they should consider the new world order of investment truths, as expressed in three basic principles outlined by Andrew Lo.
Andrew Lo is quoted about the shrinking size of the nation's stock market: "We should be very concerned about this trend. Capital markets are central to business formation and economic growth, and if listings are falling, that is a sign there is not the same level of capital formation as there was in the past."
MIT Sloan Prof. Andrew Lo is quoted about the potential risks of labeling companies which would be a necessary evil stemming from the Dodd-Frank financial reform bill: "I think that it could actually be quite dangerous and there could be a lot of unintended consequences to that process."...
Risk management has begun to eclipse investment returns as the primary focus of a growing number of U.S. pension fund executives, reflecting lingering concerns over just how vulnerable institutional portfolios proved during the market's recent meltdown. MIT professor, Andrew Lo says that a growing number of institutional investors have "gotten religion," concluding they can't sit idly by and allow these volatility shocks to take them by surprise.
Like a contemporary "whodunit" with a global crime scene, the financial meltdown has left behind countless victims, and lots of pointing fingers. The reasons for the collapse are debated by this group of estimable economists, some of whom worry that without really understanding what happened, we are in for a repeat episode.