WHAT'S NEW?

FINANCIAL MARKET COURSES

Portfolio Theory – The Markowitz Model

This course provides a description of the pioneering work of Harry Markowitz on portfolio theory. Beginning with the basic concepts required to understand modern portfolio theory, the course then moves on to discuss the relationship between individual securities and portfolios, the benefits of a diversified portfolio and the decision as to the optimal portfolio.

  • OBJECTIVES

    On completion of this course, you will be able to:

    Explain how Markowitz's portfolio theory is based on the presumption that investor behavior is mainly characterized by risk aversion and expected utility maximization

    Explain how the expected returns and risks of individual securities contribute to the expected return and risk of a portfolio

    Analyze the effectiveness of diversification for different degrees of correlation among securities in a portfolio

    Choose the optimal portfolio along an efficient frontier curve

  • COURSE OUTLINE

    Topic 1: The Origins of Portfolio Theory

    Portfolio Theory

    Attitude to Risk

    Utility Theory

    Utility & Attitude to Risk

    Utility & Risk Aversion

    Indifference Curves

    Topic 2: The Relationship Between Individual Securities and Portfolios

    Individual Securities – Expected Return

    Calculating Expected Return

    Portfolios – Expected Return

    Risk

    Individual Securities – Risk

    Calculating Standard Deviation

    Portfolios – Risk

    Covariance of Returns

    Topic 3: The Benefits of Diversification

    Diversification Defined

    Perfectly Correlated Returns

    Uncorrelated Returns

    Diversification & The Number of Securities

    Topic 4: The Efficient Frontier

    The Optimal Portfolio

    Markowitz’s Portfolio Theory – Key Points

  • PREREQUISITE KNOWLEDGE

  • ESTIMATED COMPLETED TIME

    55 Minutes

Next Course

VIEW COURSE

INTERMEDIATE

Support

Accreditations

General: info@intuition.com

Accounts: ar@intuition.com

http://support.intuition.com

Intuition engages with over 30 accreditation bodies to ensure Know-How can be used for CPE credits. If your organization needs CPE from a body not listed below, contact us and we will endeavour to have them included.

© Copyright 2016 by Intuition. All Rights Reserved.