BULLS & BEARS: High risk doesn’t always translate into high returns
Previously, we were discussing Jeremy Grantham’s brash newsletter about global bubbles (found at www.gmo.com). His frank talk is a bit stunning to me. Grantham’s expertise is in analyzing the relative values of various asset classes and arriving at estimates of their future returns. And he has reached an unprecedented conclusion: Over the next years, higher-risk investments will earn poorer returns for investors than lower-risk investments. Historically, investors have been compensated with higher returns for taking on more risk. In the…