- They are a positional check assuring the reader that they lie deep within the herd. Belonging to the pack is exceedingly important should shocks occur. Losing money is one thing, but losing more money than your peer group is a threat to career and livelihood. Reams of paper supporting your error-prone decissions, authored by respected houses, goes a long way towards saving your job rather than losing money having gone out on your own.
Investment managers don't so much target outperforming their benchmarks as they do outperforming their peers.
Excellent post.
May I also add another purpose?
- They are a positional check assuring the reader that they lie deep within the herd. Belonging to the pack is exceedingly important should shocks occur. Losing money is one thing, but losing more money than your peer group is a threat to career and livelihood. Reams of paper supporting your error-prone decissions, authored by respected houses, goes a long way towards saving your job rather than losing money having gone out on your own.
Investment managers don't so much target outperforming their benchmarks as they do outperforming their peers.