Advisor: No, I would only invest in that fund if you're willing to take on the risk."
Poor Joe: But it guarantees a minimum annual return ... and I could get more."
Advisor: But, if you've read Sharpe and Markowitz you'd understand that the risk is greater than the S&P 500 or ..."
Poor Joe: I brought along a chart, for the past twenty years. Maybe you could comment on it.
You can see that even the minimum isn't that bad and there's a chance that I get more and ..."
Advisor: Look at that volatility! Didn't I tell you? It's much riskier! According to Modern Portfolio Theory ..."
Poor Joe: Okay. Okay. Sorry. I guess I just don't understand these things."
See Risk Measures and
Risk and Volatility
