Understanding Beta: A Guide for Physician Investors

Posted on September 27, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

MUCH MORE COMPLICATED THAN MOST [PHYSICIAN] INVESTORS THINK!

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By Dr. David Edward Marcinko MBA CMP®

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SPONSORED: http://www.CertifiedMedicalPlanner.org

REAL LIFE EXAMPLE: May 11, 2021

Dow34,269.16-473.66-1.36%
S&P 5004,152.10-36.33-0.87%
Nasdaq13,389.43-12.43-0.09%
GlobalDow4,011.09-61.07-1.50%

Most all investors and physician executives are aware of the concept of financial beta.

BETA: A Systemic risk measurement benchmark correlating with a change in a specific index.

EXAMPLE: The measure of a stock’s volatility relative to the market, where a beta lower than 1 means the stock is less sensitive than the market as a whole; higher than 1 indicates the stock is more volatile than the market. The healthcare industry is considered to be increasingly volatile and hence possess a higher beta.

CITATION: https://www.r2library.com/Resource/Title/0826102549

See the source image

QUERY: But, what about more granular concepts like Levered Beta vs Un-levered Beta?

LINK: https://corporatefinanceinstitute.com/resources/knowledge/valuation/what-is-beta-guide/

ALPHA versus BETA Podcast: https://youtu.be/dP_23vKJ3HQ

YOUR THOUGHTS ARE APPRECIATED

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

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PODCAST: What is SMART BETA?

Posted on October 20, 2024 by Dr. David Edward Marcinko MBA MEd CMP™

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REALLY SMART -OR- NOT REALLY

BY: DR. DAVID EDWARD MARCINKO MBA MEd CMP®

SPONSOR: http://www.MarcinkoAssociates.com

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SPONSOR: http://www.CertifiedMedicalPlanner.org

Smart beta investment portfolios offer the benefits of passive strategies combined with some of the advantages of active ones, placing it at the intersection of efficient-market hypothesis and factor investing.

Offering a blend of active and passive styles of management, a smart beta portfolio is low cost due to the systematic nature of its core philosophy – achieving efficiency by way of tracking an underlying index (e.g., MSCI World Ex US). Combining with optimization techniques traditionally used by active managers, the strategy aims at risk/return potentials that are more attractive than a plain vanilla active or passive product.

CITATION: https://www.r2library.com/Resource/Title/0826102549

Originally theorized by Harry Markowitz in his work on Modern Portfolio Theory (MPT), smart beta is a response to a question that forms the basis of MPT – how to best construct the optimally diversified portfolio. Smart beta answers this by allowing a portfolio to expand on the efficient frontier (post-cost) of active and passive. As a typical investor owns both the active and index fund, most would benefit from adding smart beta exposure to their portfolio in addition to their existing allocations.

Financial beta: https://medicalexecutivepost.com/2021/05/12/so-what-is-financial-beta-granularly/

Assessment: The smart beta approach is an arguably perfect intersection between traditional value investing and the efficient market hypothesis. But, is it worth the cost?

More: https://www.bloomberg.com/opinion/articles/2018-06-08/smart-beta-performance-isn-t-worth-the-cost

ALPHA versus BETA Podcast: https://youtu.be/dP_23vKJ3HQ

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INVITE DR. MARCINKO: https://medicalexecutivepost.com/dr-david-marcinkos-

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