News broke that a year-to-date largest venture fund was formed in the news:

Khosla Ventures, the venture-capital firm run by longtime Silicon Valley investor Vinod Khosla, closed a $1.05 billion fund that ranks as one of the biggest new venture funds this year, from which it plans to invest a large portion in clean technology.

In closing the fund, the Menlo Park, Calif., firm is bucking two prevailing trends in the venture-capital industry, including an anemic fund-raising environment that has winnowed the number of venture firms that can raise large pools of capital.

It is good hear that a fund specialized on clean technology come out at a time a few renewal energy companies bankrupt. This also brings in needs to justify if this is a right investment decision and timing. No matter what has actually entice investors into this fund, the return seems still in the dark. A more interesting question, why people would invest in uncertainty?

Investment may seek various purposes. Financial planners remind clients that they should prioritize their needs and allocate asset accordingly. It is true that someone may attempt to have more risky investment so that they can get rich quick. On the other hand, some would be elevated if they can get the same yield as Treasurys, securely. These clouds expect different market trends: the first group like volatility while the latter one dislike it. Correspondingly, they would participate or shun volatility. This appears as a negative loop to balance the market. So if we can quantify the driving power of volatility, we can predict where the market is heading.

This was the same idea 40+ years ago how the portfolio theory was born, even though the fundamental of the theory is to maximize return with minimum risk. But again, investment has different goals, thus investment has different paths.