Using standard deviation as the sole measure of investment risk overlooks the fact that real investors tend to care much more about downside volatility and far less about volatility when returns are above average, according to Buckingham Asset Management principal and director of research Larry Swedroe.

Other measures are also needed to get a fuller picture, he says, in an article published on Indexfunds.com ( click HERE > )

Why? Two investments with similar standard deviations can experience entirely different distribution of returns. A normal distribution (of returns) will exhibit the familiar be...