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Risk tolerance is all well and good and I agree with you there, but you want the risk adjusted rate of return to be favorable, which it isn't for buying and hol
by User23 5y ago
Risk tolerance is all well and good and I agree with you there, but you want the risk adjusted rate of return to be favorable, which it isn't for buying and holding geared ETFs[1]. Highlight quote: "It is mathematically impossible to create a fund that makes a continuous offering of its shares and consistently delivers for all its shareholders a stated multiple of a benchmark over time."
[1] https://www.proshares.com/faqs/geared_investing_faqs.html https://www.proshares.com/faqs/geared_investing_faqs.html
- dannyw 5y agoNo, investing isn't all about optimising for sharpe ratios. For individual investors sometimes you do want a higher CAGR even at a worse risk adjusted return.
- User23 5y agoYou’re not wrong, but that reduces to sometimes you want to win the lottery. Sure, that’s great if it happens for you.