Brendan McCurdy: Volatility is dead - long live volatility

Is volatility, as a measure of risk, dead? Of course not. You might not think it, given recent debates among quite a few academics and practitioners, but the magnitude of a portfolio's ups and downs matters hugely. Risk, the argument goes, should be defined as the chance of outliving one's money due to permanent loss of capital. Volatility is viewed as short-term noise. From here, the case follows that investors should hold all equities because the short-term noise does not matter. The only problem is, the anti-volatility crowd's claims of realism are usually anything but realistic. W...