CFAFrank wrote > >Suppose if you tell your clients that because you have stricter restrictions and S&P is a >crappy benchmark so you can’t beat it, you will go home and suck your mother’s @#$%& >because you will lose your job and probably your shorts too. > Frank, you missed my point here. I am saying that many clients demand strict standards and pay their managers to manage defensively, hence the S&P would be a poor benchmark for someone following orders. They may actually do quite well, at what they were instructed. Take ERISA funds for example, there are alot of them, but they don’t have access to the full S&P for investment. Additionally, people get rewarded for creating skew. You can’t see it in the mean return, but its in the variance, if you use a more accurate measure like downside deviation though, it would show up, that’s what they’re being compensated for creating. But, hey, what do I know.
yeah, that is right. i agree. i wonder how many of them are CFA