Howard Marks: Risk vs Volatility and the misconceptions of investing in index funds

In this video Howard Marks, Co-Chairman of Oaktree Capital Management, explains his views on the difference between risk and volatility. You know, investors get sloppy and don't look deeply into the meaning of things. People say I'm going to invest in an index fund and get rid of the risk. Well, the risk they get rid of is the risk of under-performing. Of course, the price of giving up the risk of under-performing is giving up the risk of over-performing. But let's say that's fine, they still retain significant risk, because if an index fund is guaranteed to emulate the market then every time the market goes down the index fund investor will lose money. Now may be the rest will lose money too, but at least they are trying not to. access the full transcript and video here: (VIEW LINK)


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