Inefficient portfolio

Inefficient portfolio

Group of assets dominated by at least one other portfolio under the mean variance rule. For example, if A has both lower return and higher volatility than B, we say A is dominated by B.

Inefficient Portfolio

A portfolio that provides too low a return for the risk. That is, an inefficient portfolio has taken on so much risk that the return is not worth the effort. In Markowitz portfolio theory, an inefficient portfolio is graphically represented as any portfolio that does not follow the efficient frontier, or the set of portfolios that provide the highest return at each different level of risk.
References in periodicals archive ?
A], for which the capital requirements induce the insurer to select an inefficient portfolio over the corresponding efficient one.
Consequently, the insurer is forced to select the inefficient portfolio in the short run.
Furthermore, we systematically select inefficient portfolios and assess their admissibility, too.
Moreover, in the fourth section, we run the quadratic programs for portfolio optimization with various constraints and calculate the capital requirements for the efficient as well as selected inefficient portfolios.
On the other hand, for an SSD inefficient portfolio with respect to [W.
For SSD inefficient portfolios, several SSD portfolio inefficiency measures were introduced in [24], [11] and [8].
The company firmly believes that the most economical way of adding new electricity generation capacity is by repowering the aging and inefficient portfolio of existing power plants and by moving to gas power generation and renewable energy.
However, we believe the more important issue regarding the use of a high number of underlying funds is that the practice can lead to over-diversification and an inefficient portfolio design that may lead to index-like returns less than the value-added fees charged by the various funds.
But due to the scarcity of long-dated gilts, there is often a mismatch between a fund's cash flows and the liabilities, which in turn results in inefficient portfolio risk budgeting.
And the managers who were invested the most in their home states ended up with the most inefficient portfolios.
Their inefficient portfolios and skewed risk taking is hurting results, and as the numbers show, the cost is very high.
Of the 69 percent of participants in the report with inappropriate risk or inefficient portfolios, 38 percent have very risk-inappropriate or very inefficient portfolios.