In statistical terms, absolute return strategies should have very low correlation with the market return.
He expects market returns of 15 to 20 percent a year, annualized, over the next three to five years.
The following products are targeted for market return in 2012:
In order to earn more than the market return, you have to take money from somebody else.
The market return is defined as the wealth-weighted sum of all investment returns in the economy.
Swings in exchange rates also skewered market returns for foreign investors.
"It works just like any other business with shareholders who get standard market returns."
But, eventually, their long-term growth rate will level out within this range - a rate economists know as the stock market's "expected return."
With index funds, investors are assured of getting market returns.
And it quickly wiped out all the bond market returns.