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In a study published in 2003, the mutual fund giant Vanguard looked at the performance of so-called balanced funds, which have the option of investing in a mix of stocks and bonds Vanguard researchers examined 40 years worth of data and came to the conclusion that nearly 77 percent of the variability of a fund s monthly returns can be explained not by the individual stocks and bonds the manager selects, but by the percentage of money those funds hold in stocks versus bonds In other words, less than a quarter of the average fund s month-to-month uctuations can be attributed to its manager s stock-picking or market-timing acumen This seems to support the groundbreaking study, Determinants of Portfolio Performance, which examined the performance of pension funds from the mid1970s to the mid-1980s Published in 1986, the study looked at the same basic question: How much of a fund s performance is dependent upon its allocation strategy It concluded that 936 percent of those pension funds quarterly returns could be explained by asset allocation decisions, not stock selection And in 2000, a study published by Yale nance professor Robert Ibbotson showed that over longer periods of time, nearly 100 percent that s right, virtually all of a portfolio s long-term returns can be explained by its mix of stocks and bonds, not its individual holdings To be sure, in a single year, the stock-picking skills of a speci c manager can make a big di erence A professional stock picker, like any other human being, can have a good or bad year A wrong and big bet on tech stocks or gold or bonds could easily blow up a single portfolio in a brief window of time But among a universe of tens of thousands of stock pickers, it all averages out And over long periods of time, averaged out over those tens of thousands of investors, stock selection becomes almost irrelevant when compared with asset allocation To some of you, this may still seem far-fetched After all, if you held 100 percent of your money in a stock like Enron, and saw it go from around $80 a share at its peak all the way down to pennies on the dollar after the company led for bankruptcy, then the individual stock you held in this case, Enron would explain 100 percent of your performance But the fact is, most investors don t just own one or two stocks they own a diversi ed mix of equities, to reduce risk in their portfolios And as your diversi ed mix of stocks grows and begins to mimic the overall market in terms of risk, then stock selection matters less and allocation strategies matter more Think of it this way: If you own an S&P 500 fund, you are a part owner of 500 di erent companies If one of those companies soars, that works to your advantage But the fact remains that it is still only one of 500 di erent holdings And the performance of each of those stocks tends to average out over time.



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Part II:

FIGURE 4-3

Listener Name javaxservletServletRequestEvent javaxservlethttp HttpSessionListener javaxservlet ServletContextListener javaxservlet ServletRequestAttributeListener javaxservlet httpHttpSessionAttributeListener javaxservlet ServletContextAttributeListener

TABLE 10-1

Description Creates and destroys a ServletRequest Creates and destroys the HttpSession Creates and destroys the ServletContext Adds and removes on the attribute set of the ServletRequest Adds and removes on the attribute set of the HttpSession Adds and removes on the attribute set of the ServletContext

Fig 14-1

Your flash may overexpose close-ups if you get too close; the image on the left used natural light, but the flash was enabled for the image on the right





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Java classes must be packaged in the JAR just as normal at the top level Note that this is different than how classes are placed into a WAR file In the WAR file case, the classes go in WEB-INF/classes In a JSF component JAR, they must go at the normal top level as produced by the standard jar command

Any non-class resources associated with the components, such as images, stylesheets, and JavaScript files, may be placed anywhere in the JAR, because the responsibility for loading these resources is not covered in the JSF specification This lack of specificity has left a hole that may be filled in several ways The MyFaces implementation provides a Servlet Filter that must be installed to serve up the static images from the component WAR file 11 includes a PhaseListener that does exactly this, but for JavaScript files

This section lists the three elements of a component library configuration files, Java classes, and associated static resources by showing how the componentsjar file is organized This library contains all the components from this chapter in one easy-to-use package

Asset Allocation: Worst-Case Scenarios*

The META-INF/faces-configxml file for componentsjar is as follows:

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< xml version="10" encoding="windows-1252" > <!DOCTYPE faces-config PUBLIC "-//Sun Microsystems, Inc//DTD JavaServer Faces Config 11//EN" "http://javasuncom/dtd/web-facesconfig_1_1dtd"> <faces-config xmlns="http://javasuncom/JSF/Configuration"> <component>

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<component-type>HtmlHelloWorld</component-type> <component-class> comjsfcomprefcomponentscomponentHtmlHelloWorld </component-class> </component> <component> <component-type>HtmlHelloInput</component-type> <component-class> comjsfcomprefcomponentscomponentHtmlHelloInput </component-class> </component> <component> <component-type>HtmlStockInput</component-type> <component-class> comjsfcomprefcomponentscomponentHtmlStockInput </component-class> </component> <component> <component-type>InputDate</component-type> <component-class> comjsfcomprefcomponentscomponentInputDate </component-class> </component> <render-kit> <renderer> <component-family>InputDateFamily</component-family> <renderer-type>HtmlInputDateRenderer</renderer-type> <renderer-class> comjsfcomprefcomponentsrendererHtmlInputDateRenderer </renderer-class> </renderer> <renderer> <component-family>InputDateFamily</component-family> <renderer-type>WmlInputDateRenderer</renderer-type> <renderer-class> comjsfcomprefcomponentsrendererWmlInputDateRenderer </renderer-class> </renderer> </render-kit> <managed-bean> <managed-bean-name>ExampleUser</managed-bean-name> <managed-bean-class>comjsfcomprefexampleUser</managed-bean-class> <managed-bean-scope>request</managed-bean-scope> </managed-bean> <component> <component-type>SvgBarChart</component-type> <component-class> comjsfcomprefcomponentscomponentSVGBarChart </component-class> </component> <managed-bean> <managed-bean-name>ExampleChartData</managed-bean-name> <managed-bean-class>

Asset Mix 100% stocks, 0% 80% stocks, 20% 60% stocks, 40% 50% stocks, 50% 40% stocks, 60% 20% stocks, 80% bonds bonds bonds bonds bonds bonds

Part II:

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