Investment Week comment: Take a good dose of risk

Before the crunch, all that many investors wanted was superior returns.

During and since, many may feel on reflection a good dose of risk management would have come in handy, too. It could be argued these approaches to investing are mirrored, respectively, by stockpicking managers, and by hedge or absolute return funds. Stockpickers will trumpet what they have made, usually versus a benchmark. Long/short managers and quant funds, by contrast, will trumpet how much they did not lose. Retail absolute return funds now hold almost £19bn, largely because investors will accept greater constraints on risk taking, even if the payoff for this is lower returns. ...