No Modern Portfolio Theory is definitely NOT dead
Posted on: 02/06/2015
A note from Vern Sumnicht…
The piece I wrote back in 2009 was more or less a knee-jerk response to an article titled, “Modern Portfolio Theory is Dead.” The point was to simply ask which of the principles of Modern Portfolio Theory are no longer true. I think it’s more than obvious that these sound principles of investing that have been with us for more than 50 years, and will be here 50 years from now.
iSectors® Post-MPT Growth Allocation is soundly based on these principles. Our success is derived from how we apply the principles vs. how they are traditionally applied in the industry. Modern Portfolio Theory’s principles were published in the late 1950’s. We have had 50+ years of additional research since then, including behavioral finance.
This research has provided substantial insight on the application of Modern Portfolio Theory’s principles. iSectors® Post-MPT Growth Allocation simply takes the advice from this research and applies it. Actually, the successful results of iSectors® Post-MPT Growth Allocation over the past 10 years are the best evidence that Modern Portfolio Theory is not dead.
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