Quote:
Originally Posted by Cowboy89
What due diligence? If someone understands the risk-return frontier, (ie as average return goes up so does the risk) they'd understand that a claim of 25% per annum = far too risky for suitable investment for their entire life savings regardless of how snazzy the pitchman's dressed or how legit the letterhead of the company looks, or how many of their friends recommend it. The initial pitch language right away should kick the 'reject' side of the decision tree in gear before even finding out any more details.
But alas people are far too greedy and ignore life's enternal truth. Finance is like everything else in life from wieght loss, to achieving higher levels of education, to quitting smoking, to pretty much any accomplishment worth accomplishing: It takes discipline, time, and effort, and any attempt to speed up the process is wraught with potential failure.
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Believe it or not the average investor has never heard of Harry Markowitz and I don't think the fraudsters are covering off the risk-return frontiers in their information sessions. Besides...."The upside of the Great Recession is that it could drive a stake through the heart of the academic nostrum known as the efficent-market hypothesis" Roger Lowenstein