Unleashing the Power of Modern Portfolio Theory: Maximizing Returns while Managing Risk

Modern Portfolio Theory (MPT) Overview:

• Modern portfolio theory is a mathematical approach that helps in creating an investment portfolio by considering both the potential risks and returns.
• This theory has evolved since the 1950s and describes the mathematics of constructing an optimal portfolio based upon risk and return parameters.
• It involves selecting assets that have a correlation with historical returns and that can diversify the portfolio.
• MPT key component is Diversification meaning that optimal results are achieved by selecting a balanced mix of high-risk/high-return and low-risk/low-return investments, tailored to individual risk tolerance.

Objective:

This poster is intended to help you all understand the end-to-end process of modern portfolio theory using real-time data. I assure you, it's an interesting one!