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3 Another study , covering the period 1983-2006 utilizing the Russell 3000 Index, achieved similar and consistent results. Many – probably most – investors who cash out when negative volatility rears its ugly head will see their chances of investment and retirement success decrease significantly. Negative volatility hurts.
00:03:14 [Mike Greene] So that was actually an outgrowth from my experience coming out of Wharton and you mentioned the, the, you know, the transition of people who tended to be skilled at math or physics into finance. People earn wages, whether it’s a retirement account or a tax deferred account or just an investment account.
So I took it upon myself to go off and took a course in bond math, took another course in derivatives and realized the underlying fundamental concepts were barely, I mean, it wasn’t even high school math in most cases. And then in a fit of madness, I guess, at the end of 2006, the credit markets were pretty uninteresting.
In my opinion the diversification benefit hits diminishing returns pretty close to 40 individual holdings based on math if nothing else. I've got quite a few names that have been in the portfolio since 2004-2006 when I first started this phase of my career. If a portfolio starts with 40 holdings each with an equal 2.5%
So I decided to take some action, by doing the math for myself using a spreadsheet. I still don’t have much experience with the US healthcare system – it helped deliver my son in 2006, and then repair that same boy’s broken arm in 2016. I felt like I was being squeezed from both ends and it was starting to p**s me off.
This was the era, 2005, 2006, all of my friends were looking to get banking roles. And I, and I really like the application of math and statistics and computer science to markets. You learn the math that can help you with, with market making operations. It’s just not smart on a math basis to do that.
I’d been ranked i i back in the seventies, if you can do the math. 00:19:54 [Speaker Changed] So you retired if it’s not working and you move on to the next that. But if you go back to 2006 point half percent sounds high. So at that point, I had a pretty big career. Really 00:39:29 [Speaker Changed] High.
And this was back in 2005 or 2006. MORGENSON: And so you have pensioners at Bristol-Myers or Lockheed or Coors is another who are really relying on private equity to do the right thing for their pensions going forward, for their retirement, for their payouts when they need them. And these guys don’t like money sitting on a shelf.
SIEGEL: — or 2006, ’07, ‘08. My first four years of teaching was his last four years before he retired. I saw him a lot after he retired — he lived in San Francisco — whenever my wife and I went there. You are going to be guaranteed great returns when you retire. We became very close friends.
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