What's Behind the Numbers?

Abstract

Selecting an investment manager is a matter of choosing the manager who can produce the best numbers in the future. But, the same set of numbers drawn from the past can often present two very different pictures. Changing the benchmark, changing the fiscal year, risk-adjusting the performance, can all make a bad product look good or a good product look bad. The quest for a single, simple measure of performance often leads to an overly simplistic view of the past, which can lead to poor choices for the future.