Risk over returns in investment market

Fund managers need to target risk rather than returns if they are to survive and prosper, according to Aon Consulting's head of quantitative research, Martyn Dorey. Speaking at the recent Quantitative Investment Conference in Lausanne, Dorey said there is a level of risk to target that is independent of fund manager skill. He said: "The level of risk to target depends on the hopes and fears of plan sponsors. If you want to outperform your benchmark, you need to take on more risk against your benchmark. "If you dislike underperformance against your benchmark, you need to pull your risk...