Tag Archives: short term bonds

Risk, Return and Low Beta Stocks

My article in last week’s Advisor Perspectives titled, “The Greatest Anomaly in Finance: Understanding and Exploiting the Outperformance of Low-Beta Stocks,” explores what the findings of a 2011 paper published in the Financial Analysts Journal called “the greatest anomaly in finance.”  The issue at hand is one that I have written about in a number of articles including “Why Low Beta Strategies are Worth Another Look,” and one that I’d like to explore further in today’s blog post.

Financial theory suggests that risk and return go hand-in-hand. While higher-return assets do tend to be riskier than lower-return assets, there is a notable exception. Continue reading