The next several years will be a challenging period for investment advisors as investors, mindful of projections of low market returns, seek managers who can deliver results while protecting them from excessive risk.
Many investors believe the market meltdown of 2008-2009 stemmed from lapses in risk management. This is ironic because the general state of risk management before the meltdown was hardly a lapse. For decades, most investing methodologies had failed to address risk in respects essential not only to protecting investors but also to maximizing returns. Even after the general risk-management lessons of 2008-2009, this failure continues today.