The finance guys may have been aware of it, but their actions were clearly not in line with this knowledge as evidence by the year 2008.
From the article you linked: "None of this implies, however, that the existence of outliers undermines modern portfolio theory or asset pricing theory."
In fact, that's exactly what it does. This is what happens when you build houses on top of sand.
From the article you linked: "None of this implies, however, that the existence of outliers undermines modern portfolio theory or asset pricing theory."
In fact, that's exactly what it does. This is what happens when you build houses on top of sand.