Portfolio Theory As An Investment Decision Instrument

1697 Words Jun 30th, 2015 7 Pages
This research paper is based on the Portfolio Theory written with a primary objective of demonstrating how it helps an investor to characterize, quote, and control both the kind and the amount of expected risk and return in an attempt to boost portfolio expected return for a given amount of portfolio risk, or equally minimize risk for a given level of expected return. A procedure section is included which analyzed applicability if the theory to ongoing investment decisions relative too the assumptions of the Portfolio Theory. The paper is summarized to give packed perspective of the discussion upon conclusions were drawn while referencing cited writings. Investment Decisions: Portfolio Theory
This is an analysis of the Portfolio Theory as an investment decision instrument. In the investment world, there exist different intentions for investment. The most well known is to earn a return on investment.
In any case, selecting investments on the basis of returns is not adequate. The way that most investors invest in their funds in more than one security proposes that there are different factors, other than return, and they must be considered. Investors not only like return but also dislike the risk.
The financial market, regardless of the benefits, is an intricate unstable industry that requires keen analysis to sufficiently determine risks relative to returns to aid decisions regarding participation in the industry. This paper is an effort to create an understanding of how the…

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