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    In The News

    Find out how your practice would fare in the next down market

    By, Ron Piccinini, PhD, Director of Product Development From a risk manager’s perspective, a bank is a derivative on interest rates. Similarly, RIA practices can be viewed as a derivative on stock and bond markets. Here’s a quick way to estimate the sensitivity of your practice to markets.
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    In The News

    Investors Chronicle article features Ron Piccinini, PhD

    Investors Chronicle published an article, "Does fortune favour the bold?" by James Norrington on July 27, 2017.
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    Risk

    Live webcast: with the creators of SmartRisk

    Advisors, you’ve come to the right place. Join Joe Elsasser, CFP® and Ron Piccinini, PhD, live on November 9 at 3:00 p.m. Central, as they answer your questions about SmartRisk.
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    In The News

    WATCH: Don't Be Fooled Into Believing a Portfolio is Diversified

    SmartRisk was created for one overarching reason: risk software on the market is based on outdated math, and that math dramatically underestimates risk. Advisors should care about explaining risk to clients because helping them avoid the classic pitfalls that can destroy retirements builds a stronger, more trusting relationship. SmartRisk's massive computing power and sophisticated models properly measure portfolio risk. Join Joe Elsasser, CFP®, President of Covisum and see how SmartRisk can impact your financial practice. 
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    In The News

    Why financial advisors never really used beta, and why they are right

    By Ron Piccinini, PhD Director of Product Development How can you tell if someone went to Harvard? They will tell you within five minutes of meeting them, as the popular joke goes. Similarly, ask any freshly-minted finance MBA or CFA candidate about portfolio construction, and chances are high that you will hear about ‘beta’ in pretty short order. As most advisors know, beta is the key statistic in Modern Portfolio Theory (MPT), and has something to do with the volatility of a stock or asset class relative to the market. According to the Theory, the expected return of a stock depends solely on its sensitivity to the equity risk premium, a.k.a. ‘beta’. If your client needs a higher expected return on her portfolio, you should increase the allocation to ‘high-beta’ assets. Conversely, you should increase the portion of ‘low-beta’ assets for that hypothetical client seeking lower expected returns. In an informationally efficient market, high expected returns should not be available without taking high levels of risk, thus beta became a measure of risk along the way. If the only source of expected returns comes from an asset’s sensitivity to the market (beta), then only stocks with betas greater than 1.00 will provide greater returns than the market, and since risk and return go hand-in-hand, it follows that high-beta stocks are the riskier ones. Pretty simple isn’t it?
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    In The News

    Covisum's president, Joe Elsasser, CFP®, featured in Financial Planning

    It's no secret, Joe Elsasser, our company president uses Covisum technology to reinforce measurable value for his own clients in his personal financial practice. He was recently quoted in Financial Planning:
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