efficient portfolio

Efficient portfolio

A portfolio that provides the greatest expected return for a given level of risk (i.e., standard deviation), or, equivalently, the lowest risk for a given expected return.

Markowitz Efficient Portfolio

In Markowitz Portfolio Theory, a portfolio with the highest level of return at a given level of risk. One who carries such a portfolio cannot further diversify to increase the expected rate of return without accepting a greater amount of risk. Likewise one cannot decrease his/her exposure to risk without proportionately decreasing the expected return. A Markowitz efficient portfolio is determined mathematically and plotted on a chart with risk as the x-axis and expected return as the y-axis. See also: Markowitz efficient set of portfolios, Homogeneous expectations assumption.

efficient portfolio

A combination of investments that offer either the highest possible yield at a given risk level or the lowest possible risk at a given yield level. Although the concept of an efficient portfolio is important to understand, in practice it is more academic than practical.
References in periodicals archive ?
Among the advantages are broad diversification, professional management, liquidity, efficient portfolio management and, most importantly, the opportunity to buy at a discount to the net asset value of the fund.
We have a very efficient portfolio and we still have more we can do to it.
The LifeYield Advantage Suite is the industry's only tax efficient portfolio software with actionable multi-account advice that empowers Financial Advisors to offer advice and guidance designed to help increase wealth and improve the retirement of their clients.
We built it to help solve a need that they saw, to deliver an efficient portfolio construction and segment their client base," Kalbaugh said.
com)-- The tools provided through the Diversify Portfolio website focus on diversification, correlation and efficient portfolio construction.
It could in fact very well be the other way round: the losses in expected return that are incurred by foregoing an efficient portfolio may be overcompensated by the cost of capital that is saved through the associated reduction in equity.
It is very often claimed by the mutual funds managers that they have efficient portfolio.
In a recent update of Unified Wealth Platform, Fiserv transformed support of MFA programs with a new digital user experience, providing users with more efficient portfolio management and trading solutions.
Our collaboration with Saxo Bank combines our equity research into an effective and efficient portfolio offering that is available to a wide audience.
In contrast, here the VaR line is used to select the efficient portfolio or the amount of borrowing and lending of the investor.
The share sale was closed at a premium of over 38% to the initial purchase price and is an example of efficient portfolio management and optimization program of Rosneft.
Since Equation (1') is the necessary and sufficient condition for the optimal portfolio solution [omega]* within the mean-variance framework, and Equation (1') mathematically equals (1), the unique [omega] in Equation (1) must be the optimal mean-variance efficient portfolio [omega]*.

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