• Member Statistics

    • 763,098 Colleagues-to-Date [Sponsored by a generous R&D grant from iMBA, Inc.]
  • David E. Marcinko [Editor-in-Chief]

    As a former Dean and appointed Distinguished University Professor and Endowed Department Chair, Dr. David Edward Marcinko MBA was a NYSE broker and investment banker for a decade who was respected for his unique perspectives, balanced contrarian thinking and measured judgment to influence key decision makers in strategic education, health economics, finance, investing and public policy management.

    Dr. Marcinko is originally from Loyola University MD, Temple University in Philadelphia and the Milton S. Hershey Medical Center in PA; as well as Oglethorpe University and Emory University in Georgia, the Atlanta Hospital & Medical Center; Kellogg-Keller Graduate School of Business and Management in Chicago, and the Aachen City University Hospital, Koln-Germany. He became one of the most innovative global thought leaders in medical business entrepreneurship today by leveraging and adding value with strategies to grow revenues and EBITDA while reducing non-essential expenditures and improving dated operational in-efficiencies.

    Professor David Marcinko was a board certified surgical fellow, hospital medical staff President, public and population health advocate, and Chief Executive & Education Officer with more than 425 published papers; 5,150 op-ed pieces and over 135+ domestic / international presentations to his credit; including the top ten [10] biggest drug, DME and pharmaceutical companies and financial services firms in the nation. He is also a best-selling Amazon author with 30 published academic text books in four languages [National Institute of Health, Library of Congress and Library of Medicine].

    Dr. David E. Marcinko is past Editor-in-Chief of the prestigious “Journal of Health Care Finance”, and a former Certified Financial Planner® who was named “Health Economist of the Year” in 2010. He is a Federal and State court approved expert witness featured in hundreds of peer reviewed medical, business, economics trade journals and publications [AMA, ADA, APMA, AAOS, Physicians Practice, Investment Advisor, Physician’s Money Digest and MD News] etc.

    Later, Dr. Marcinko was a vital recruited BOD member of several innovative companies like Physicians Nexus, First Global Financial Advisors and the Physician Services Group Inc; as well as mentor and coach for Deloitte-Touche and other start-up firms in Silicon Valley, CA.

    As a state licensed life, P&C and health insurance agent; and dual SEC registered investment advisor and representative, Marcinko was Founding Dean of the fiduciary and niche focused CERTIFIED MEDICAL PLANNER® chartered professional designation education program; as well as Chief Editor of the three print format HEALTH DICTIONARY SERIES® and online Wiki Project.

    Dr. David E. Marcinko’s professional memberships included: ASHE, AHIMA, ACHE, ACME, ACPE, MGMA, FMMA, FPA and HIMSS. He was a MSFT Beta tester, Google Scholar, “H” Index favorite and one of LinkedIn’s “Top Cited Voices”.

    Marcinko is “ex-officio” and R&D Scholar-on-Sabbatical for iMBA, Inc. who was recently appointed to the MedBlob® [military encrypted medical data warehouse and health information exchange] Advisory Board.

    entrepreneur

    Frontal_lobe_animation

  • ME-P Information & Content Channels

  • ME-P Archives Silo [2006 – 2019]

  • Ann Miller RN MHA [Managing Editor]

    ME-P SYNDICATIONS:
    WSJ.com,
    CNN.com,
    Forbes.com,
    WashingtonPost.com,
    BusinessWeek.com,
    USNews.com, Reuters.com,
    TimeWarnerCable.com,
    e-How.com,
    News Alloy.com,
    and Congress.org

    Comprehensive Financial Planning Strategies for Doctors and Advisors: Best Practices from Leading Consultants and Certified Medical Planners(TM)

    Product Details

    Product Details

    Product Details

  • CERTIFIED MEDICAL PLANNER® program

    New "Self-Directed" Study Option SinceJanuary 1st, 2018
  • Most Recent ME-Ps

  • PodiatryPrep.org


    BOARD CERTIFICATION EXAM STUDY GUIDES
    Lower Extremity Trauma
    [Click on Image to Enlarge]

  • ME-P Free Advertising Consultation

    The “Medical Executive-Post” is about connecting doctors, health care executives and modern consulting advisors. It’s about free-enterprise, business, practice, policy, personal financial planning and wealth building capitalism. We have an attitude that’s independent, outspoken, intelligent and so Next-Gen; often edgy, usually controversial. And, our consultants “got fly”, just like U. Read it! Write it! Post it! “Medical Executive-Post”. Call or email us for your FREE advertising and sales consultation TODAY [770.448.0769]

    Product Details

    Product Details

  • Medical & Surgical e-Consent Forms

    ePodiatryConsentForms.com
  • iMBA R&D Services

    Commission a Subject Matter Expert Report [$250-$999]January 1st, 2019
    Medical Clinic Valuations * Endowment Fund Management * Health Capital Formation * Investment Policy Statement Analysis * Provider Contracting & Negotiations * Marketplace Competition * Revenue Cycle Enhancements; and more! HEALTHCARE FINANCIAL INDUSTRIAL COMPLEX
  • iMBA Inc., OFFICES

    Suite #5901 Wilbanks Drive, Norcross, Georgia, 30092 USA [1.770.448.0769]. Our location is real and we are now virtually enabled to assist new long distance clients and out-of-town colleagues.

  • ME-P Publishing

  • SEEKING INDUSTRY INFO PARTNERS?

    If you want the opportunity to work with leading health care industry insiders, innovators and watchers, the “ME-P” may be right for you? We are unbiased and operate at the nexus of theoretical and applied R&D. Collaborate with us and you’ll put your brand in front of a smart & tightly focused demographic; one at the forefront of our emerging healthcare free marketplace of informed and professional “movers and shakers.” Our Ad Rate Card is available upon request [770-448-0769].

  • Reader Comments, Quips, Opinions, News & Updates

  • Start-Up Advice for Businesses, DRs and Entrepreneurs

    ImageProxy “Providing Management, Financial and Business Solutions for Modernity”
  • Up-Trending ME-Ps

  • Capitalism and Free Enterprise Advocacy

    Whether you’re a mature CXO, physician or start-up entrepreneur in need of management, financial, HR or business planning information on free markets and competition, the "Medical Executive-Post” is the online place to meet for Capitalism 2.0 collaboration. Support our online development, and advance our onground research initiatives in free market economics, as we seek to showcase the brightest Next-Gen minds. ******************************************************************** THE ME-P DISCLAIMER: Posts, comments and opinions do not necessarily represent iMBA, Inc., but become our property after submission. Copyright © 2006 to-date. iMBA, Inc allows colleges, universities, medical and financial professionals and related clinics, hospitals and non-profit healthcare organizations to distribute our proprietary essays, photos, videos, audios and other documents; etc. However, please review copyright and usage information for each individual asset before submission to us, and/or placement on your publication or web site. Attestation references, citations and/or back-links are required. All other assets are property of the individual copyright holder.
  • OIG Fraud Warnings

    Beware of health insurance marketplace scams OIG's Most Wanted Fugitives at oig.hhs.gov

Understanding Risk Adjusted Portfolio Performance

Join Our Mailing List

A Vital Feedback Loop for any Medical Professional’s Investment Program

By Dr. David Edward Marcinko MBA, CMP™

[Publisher-in-Chief]

While recently visiting the beautiful Johns Hopkins University and Medical School in Baltimore Maryland, I realized that investment portfolio performance measurement — much like an annual physical exam in the Spring — is an important feedback loop to monitor progress towards the goals of the medical professional’s investment program.

Performance comparisons to market indices and/or peer groups are a useful part of this feedback loop, as long as they are considered in the context of the market environment and with the limitations of market index and manager database construction.  Inherent to performance comparisons is the reality that portfolios taking greater risk will tend to out-perform less risky investments during bullish phases of a market cycle, but are also more likely to under-perform during the bearish phase.  The reason for focusing on performance comparisons over a full market cycle is that the phases biasing results in favor of higher risk approaches can be balanced with less favorable environments for aggressive approaches to lessen/eliminate those biases.

THINK: The “flash crash” of March 2009, and the DJIA now hovering near 12,000 of  late.

The Biases

Can we eliminate the biases of the market environment by adjusting performance for the risk assumed by the portfolio?  While several interesting calculations have been developed to measure risk-adjusted performance, the unfortunate answer is that the biases of the market environment still tend to have an impact even after adjusting returns for various measures of risk.

http://www.amazon.com/Financial-Planning-Handbook-Physicians-Advisors/dp/0763745790/ref=sr_1_1?ie=UTF8&s=books&qid=1276795609&sr=1-1

Assessment

However, medical professionals and their advisors will have many different risk-adjusted return statistics presented to them, so understanding the Sharpe ratio, Treynor ratio, Jensen’s measure or alpha, Morningstar star ratings, etc. and their limitations should help to improve the decisions made from the performance measurement feedback loop.

And, these are discussed elsewhere on this ME-P.

Conclusion

Your thoughts and comments on this ME-P are appreciated. Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, subscribe to the ME-P. It is fast, free and secure.

Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Medical Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com

OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

Product DetailsProduct DetailsProduct Details

Product Details  Product Details

4 Responses

  1. Buy Equities Now!

    PIMCO’s Neel Kashkari says now is the time to stock up on equities. He cites attractive valuations, income growth and dividends

    Furthermore, Pacific Investment Management Co.’s Kashkari said investors should buy equities because valuations, income growth and dividends show the asset class is attractive.

    http://www.investmentnews.com/article/20110912/FREE/110919993

    What do you think, Dr. Marcinko?

    Craig

    Like

  2. Risks

    When an advisor recommends a particular investment, how do you know it’s right for you? Financial writers, myself included, say you need to ask questions. The trouble is, according to a recent survey, most investors ask the wrong questions.

    The survey, funded by Dimensional Fund Advisors and conducted in March 2014 by Advisor Impact, polled 1,229 investors. The respondents were almost evenly split among female and male. Most had an investment net worth of over $500,000 and almost half had an annual household income of over $100,000.

    Investors were asked, “When your advisor makes an investment recommendation for your portfolio, which, if any, of the following are important for you to know?”

    For 70% of the respondents, the most important information was the risk associated with the investment. At face value, this seems to be quite logical. What investor is unconcerned with risk? Behavioral economists tell us that most of us are far more averse to a loss than an equal chance of a gain.

    The issue is in understanding the definition of “risk.” To simply ask an advisor, “What risk is associated with this investment?” is like asking the butcher at Safeway to tell you about the risk associated with eating meat.

    The butcher, thinking about the chance of choking on a bite and dying, might say there is almost no risk. Yet this answer wouldn’t necessarily apply if the customer were thinking about the risks associated with saturated fat, mad cow disease, hormones, contamination, or allergic reactions.

    To answer the question fully, the butcher would need to ask a lot of questions and address the many potential risks associated with eating meat. The chances of that happening at a busy meat counter are highly unlikely. The consumer will probably be left with a skewed understanding, perhaps overly positive or negative, of the associated “risks”.

    The same is true with investments. A few of the risks associated with most securities include economic, political, default, legal, interest rates, business cycle, managerial, and diversification. Rarely does an investor understand the nuances of all the various components of risk. Many advisors don’t fully understand them or explain them, either.

    The second most important factor, which 58% of investors wanted to know, was what return they could expect from the investment going forward. Again, the answer to this question won’t be very helpful; there is no way the advisor can know this, unless the investment’s return is guaranteed (like a certificate of deposit or a fixed annuity). Even then, no return is completely guaranteed, even those that are guaranteed. There is always a risk factor that can terminate any guarantee, the biggest being the bankruptcy of the guarantor or political interference.

    The third most important thing investors wanted to know was the amount of the fees associated with the investment. I was surprised, though, that even though this question ranked third, less than half—47%—of the respondents thought it was important. Fees paid to advisors and middlemen are an essential consideration. They are one of the few things investors can actually control, and the fees you pay can single-handedly turn a great investment into a poor one.

    Even if you’re among the minority who inquire about fees, there is no guarantee you will get a straight answer. I’ve had many life insurance and annuity salespeople swear to me there are “no costs whatsoever” charged by their companies to the customer.

    To become an informed investor, then, your first step may be to learn what questions to ask. It’s also important to keep asking those questions until you get clear and satisfactory answers.

    Rick Kahler MS CFP
    http://www.KahlerFinancial.com
    http://www.amazon.com/Comprehensive-Financial-Planning-Strategies-Advisors/dp/1482240289/ref=sr_1_1?ie=UTF8&qid=1415028345&sr=8-1&keywords=david+marcinko

    Like

  3. Managing Sequence Of Return Risk With Bucket Strategies Vs A Total Return Rebalancing Approach

    If there’s one fundamental takeaway that’s been drawn from the research on safe withdrawal rates, it’s the fact that market volatility really matters during the retiree withdrawal years. Even when long-term returns average out in the end, if the sequence of volatile returns is unfavorable, there is a danger that ongoing distributions during the “bad” years early on could deplete the portfolio before the “good” years ever show up.

    http://www.kitces.com/blog/managing-sequence-of-return-risk-with-bucket-strategies-vs-a-total-return-rebalancing-approach/

    An essay by Michael E. Kitces MSFS, MTAX, CFP®, CLU, ChFC, RHU, REBC, CASL

    Ann Miller RN MHA

    Like

  4. Value at Risk (VAR)

    VAR is another risk measure that has been gaining in popularity for several reasons.

    First, FAs and doctors should intuitively evaluate risk in monetary terms rather than standard deviation.

    Second, in marketable portfolios, deviations of a given amount below the mean are less common than deviations above the mean for that same amount. Unfortunately, measures such as standard deviation assume symmetrical risk. VAR measures the risk of loss at some probability level over a given period of time.

    For example, a physician-investor or FA may desire to know the portfolio’s risk over a one-day time period. The VAR can be reported as being within a desired quantile of a single day’s loss. In other words, assume a portfolio possesses a one-day 90% VAR of $5 million. This means that in any one of 10 days the portfolio’s value could be expected to decline by more than $5 million. Note that VAR is only useful for the liquid portions of an endowment’s portfolio and cannot be used to assess risks in classes such as private equity or real assets.

    Thus, it would seem self-evident that a risk that is not fully understood cannot be consciously managed or mitigated.

    Dr. David Edward Marcinko MBA CMP™
    http://www.CertifiedMedicalPlanner.org
    http://www.amazon.com/Financial-Planning-Handbook-Physicians-Advisors/dp/0763745790/ref=sr_1_1?ie=UTF8&s=books&qid=1275315635&sr=1-1

    Like

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: