Chasing Returns

Chasing Returns

Slang; the act or practice of taking on more (or excessive) risk in hopes of generating larger gains. For example, an investor who overexposes his portfolio to a security that happens to be bullish is said to be chasing returns. This may or may not turn out well for the investor.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
This would include the risk of loss of purchasing power due to: interest rates, inflation, poor investment returns and poor investment decisions (chasing returns, selling low and buying high, etc.).
However, chasing returns at the expense of solid, sustainable, long-term growth is also not wise.
Schreiber will discuss the role both active and passive investing play in portfolios, and the importance of protecting capital from large losses rather than chasing returns. He will also examine the risks advisors and investors take when they rely too heavily on passive index products.
Now, there is less external capital chasing returns in Europe and the emerging economies, and some that was there has already flowed back home.
The local stock market is seen to firm up this week as there is still so much cash chasing returns in the financial system.
"People aren't chasing returns like they did before the financial crisis," said Goldberg, noting the 20% growth in deferred annuities last year.
Chasing returns will lead to buying high and selling low, the complete antithesis of an investor's goal.
Meanwhile, investors are encouraged to place increasing emphasis on risk management, rather than chasing returns. The NBAD Report discusses some basic guidelines that should help investors maximize returns in this age of economic fragility.
Or, to prevent participants from chasing returns, you might want to make it difficult for someone to day trade in his defined contribution (DC) plan-though, if someone really wants to day trade, I'm sure he will find a way.
This may help to continue the rise in the valuations that defined this year's outstanding gains for stocks.--"Chasing Returns," LPL Weekly Commentary
I simply want to reinforce that before you invest or move money, you need to determine what percentage of your capital you want "at risk" and avoid the temptation of chasing returns. If during this evaluation you find that the gains of the past few years have you over-allocated to risk assets, it may be time to rebalance your portfolio.