Optimal portfolio

Optimal portfolio

An efficient portfolio most preferred by an investor because its risk/reward characteristics approximate the investor's utility function. A portfolio that maximizes an investor's preferences with respect to return and risk.

Optimal Portfolio

A Markowitz efficient portfolio that best fits one's personal risk preference. A Markowitz efficient portfolio is the portfolio that has the highest possible potential return at a given level of risk. Thus, an optimal portfolio is the portfolio that considers the investor's own greed and/or how risk averse he/she is. A key difference between a Markowitz efficient portfolio and an optimal portfolio is the fact that, while a Markowitz efficient portfolio can be determined mathematically, an optimal portfolio is subjective.
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This study examines the benefits of commodity future investments using optimal portfolio strategy within a mean variance framework and also determines how an investor's investment policy changes when the objective function is to maximize expected utility.
The optimal portfolio lies on an efficient frontier, which shows the maximum return possible for given levels of risk.
The paper describes the computer program for compiling an optimal portfolio in the Capital Market and describes its possibilities and methods.
In this model, the preferences are weighted and then the optimal portfolio is clustered through the rough set theory [9].
Next, to demonstrate that the transaction costs have effect on the optimal portfolio selection, given [h.sub.0] = 1.7 and [mu] = 0.08, the efficient portfolios under different transaction costs are given in Table 3.
[9] studied the optimal portfolio and consumption with habit formation in a jump-diffusion market.
The portfolio optimization problem and optimal portfolio selection methods are considered in (Rutkauskas 2005; Rutkauskas, Stasytyte 2008; Rutkauskas et al.
Advisors need to recognize the unique risk and return characteristics of life insurance that make it a legitimate, separate and distinct asset class with many non-conventional uses, such as in the construction of an optimal portfolio. Structured with the right combinations, life insurance can offer predictable value and a sure way to transfer financial legacies via a guaranteed death benefit with tax efficiencies and market-driven growth potential.
While analysing investment portfolio efficiency lines in two-dimensional plane, we determine possible values of optimal portfolio, and, in turn, propose the selection of optimal portfolio, when its utility is measured according utility function depending on profitability and riskness in "risk-profitability plane".
Optimal Portfolio Choice with Wage-Indexed Social Security
"The traditional financial theory is to fund the optimal portfolio and then either lever that up or dilute it with cash to get to the right risk/return profile.
Optimal portfolio and background risk an exact and an approximated solution.

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