Unified Finance Theory

In physics, people are looking for a unified theory. It’s possible one doesn’t exist.

Ever since Maxwell discovered the way to combine the forces of electricity, magnetism, and light, physicists have sought a unified theory that ties all the forces in the universe together. Einstein worked to describe both electricity and magnetism, but there are other forces in the universe—the forces that hold a stable atomic nucleus together, or tear it apart when it’s radioactive.

Scientists haven’t yet figured out a uniform way to describe these various phenomena. There are competing models with names like String Theory, Brane Theory, or Warped Gravity. They’re all highly complex mathematical approaches to difficult problems. There’s no consensus on a single solution.

In finance as well, people look for singular answers. What’s the best portfolio? What’s the best accounting method? Which stock is hot right now? In finance, as in physics, it depends on your perspective.

The best portfolio is the one that meets your individual needs over time. If you need income, a fast growing private equity portfolio doesn’t work. If you’re a 20-something saving for retirement, a ladder of T-Bills doesn’t fit the bill, either. There’s no single approach that’s ideal for everyone. There are an array of individual requirements and limitations that have to be applied by each investor before anything is ever bought or sold.

Responsible financial professionals understand that life is complex. Anyone who tells you otherwise is probably selling something.

Douglas R. Tengdin, CFA
Chief Investment Officer
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By | 2014-09-11T11:14:24+00:00 July 29th, 2011|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. –
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