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Ultra-short bond funds, for example, lost half of their assets during 2008.
"We all heard the stories about institutional funds that had more than half of their assets in private equity in 2008" and then had to sell, he said.
And the best performers over the past year are betting more than half of their assets on their top 10 picks, while the average stock fund invests only about a third of its assets in its top 10 holdings.
According to Fitch, a ratings agency, at the end of 2007, Western banks carried about half of their assets at fair value, but the dispersion was wide: from 86% at Goldman Sachs to 27% at Bank of America (see chart).The obvious solution is to use fair value for all financial assets and liabilities.
And while the biggest banks were carrying lots of trading assets on their books, Laux and Leuz show that, at the height of the bubble, straight loans and leases still constituted roughly half of their assets, while a sizable chunk of their tradeable assets were things like mortgage-backed securities, which ultimately derived their value from the (often worthless) mortgages that underlay them.
According to the Congressional Research Service, only 0.2percentt of estates with at least half of their assets in a business would owe any estate tax, and those would pay an average effective rate of 9.3percentt.
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Inventories at listed developers rose by a quarter in the first half, reaching 65% of their assets, an all-time high, according to CICC, a Chinese investment bank.
Sir John recommends that most people keep up to half of their investment assets in Treasury bonds.
For investors ready to dig out of a miscast strategy, he advises starting with half of their invested assets, and moving incrementally.
This emerged in its starkest form at Enron, an energy company where employees had chosen to invest more than half of their pensions' assets in the company's own shares.
But since last July, many of its large banks have watched the value of their assets -- and half of their profits -- evaporate.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com