Human Capital as a Risky Asset
CFAI volume 2, page 327, states that for young investors with equity-like Human Capital the financial assets should be invested predominantly in fixed-income assets. It goes on to state that "because the value of one's human capital declines with age, the share of risk-free assets in the stockbroker's portfolio will also decline and the share of risky assets (...) will rise until retirement".
Then, on the next page, figure 9 shows the opposite. In scenario 1 (that of Human Capital risk highly correlated with the risk of other risky financial assets) the proportion of the risk-free assets starts at about 10% for age 30 (that is, not predominant at all), and increases (instead of decreasing) until reaching a maximum of about 70% at age 65.
The text explanation seems straightforward enough - but then why does the figure blatantly contradict the text?
Any comments? |
发表于 2011-7-11 19:05
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