Abnormal Quote by Robert Haugen
“Less volatile stocks tend to have negative abnormal profits; more volatile stocks tend to have positive abnormal profits.”
About This Quote
Source Academic Paper: “The Relationship Between Stock Return Volatility and Expected Returns”, 1990
Higher volatility stocks tend to earn higher abnormal returns, while low volatility stocks often underperform.
In simple terms: Riskier stocks usually give higher returns.
Key Takeaway
Consider risk‑adjusted strategies.
Themes
finance
risk
investment
market behavior
Mood
analytical
cautious
Type
financial
educational
When to use this quote
- portfolio construction
- risk management
- asset allocation
- trading strategies
Key Concepts
risk premium
volatility paradox
Questions to Reflect On
- Do you prefer stable or high‑risk investments?
- How do you balance risk and reward?
A Different Perspective
Higher returns come with higher risk; not all volatile stocks succeed.
