Hmmm. What standard finance theory tells us whether there is or is not uncompensated risk today.No, you can construct portfolios with uncompensated risk with stocks that recently underperformed as well.One reaches this question, wherein one ponders about the possible uncompensatedness of an investment, only as a result of the having in the past been subject to positive outcomes of previous investments/risk.The question is whether individual stock concentration or sector concentration has reached a level where it creates uncompensated risk in the S&P500.I believe that a lot of worries about the tech dominance stem from a deep rooted belief that the valuations in the stock market are somehow disconnected from reality.
It is very standard finance theory that diversifiable risk is not compensated with excess expected return. What we all choose to do with that and/or if and how we apply it is of course our own business.
Statistics: Posted by SB1234 — Mon Sep 02, 2024 12:32 am — Replies 236 — Views 14924
