“This large organization uses it” is probably the worst argument for using an investment tool.

I sometimes hear it as a justification for old methods like CAPM, Black-Litterman and mean-variance.

Anyone who has worked in large legacy organizations has probably experienced that they are generally technologically behind.

The assets under management (AUM) of these companies most often come from good distribution rather than good performance.

If anything, it should be an argument for not using a particular method, if you are serious about outperforming.

If the method additionally builds on assumptions that are disconnected from reality, there is no logical reason to believe that it will add value in practice.

With today’s technology, it is possible to build portfolios designed to have good tail risk-adjusted returns using realistic investment distributions, see the PDF here: