Modern Portfolio

  • The modern portfolio theory (MPT) is a method that can be used by risk-averse investors to construct diversified portfolios that maximize their returns without unacceptable levels of risk.

  • The modern portfolio theory can be useful to investors trying to construct efficient and diversified portfolios using ETFs.

  • Investors who are more concerned with downside risk might prefer the post-modern portfolio theory (PMPT) to MPT.

References

PreviousBondsNextEconomics

Last updated

Was this helpful?