Understand and control

Warren Buffett, the legendary investor, once said that if calculus or algebra were required to be a great investor, I'd have to go back to delivering newspapers. To be a successful investor, one didn't need any more maths than plain old addition, subtraction, multiplication, and division. However, don't tell that to the professional peddlers of complexity who seem to infest the world of investing. Some years back, a young' relationship manager' of some bank approached me and asked for the formula for asset allocation. He planned to input his clients' numbers-as he called them-into an equation that would magically determine the optimal distribution of their funds across various asset classes. I had to break the news to him that there was no such formula. I explained to him that deciding on an ideal asset allocation relies more on a set of rules of thumb, wh