| Abstract [eng] |
This study investigates the application of the Markowitz Portfolio Optimization Theory, which revolutionized the field of modern finance by introducing a quantitative approach to portfolio construction. The theory emphasizes the importance of diversification to achieve the optimal portfolio trade-off between risk and return. Key concepts such as the efficient frontier, risk-return trade-off, and portfolio optimization are discussed in detail, providing a comprehensive understanding of how investors can minimize risk while maximizing returns. The report also delves into the Mutual Fund Separation Theorem, which simplifies portfolio construction by demonstrating that any efficient portfolio can be represented as a linear combination of other efficient portfolios. This theorem offers practical implications, such as reducing complexity and transaction costs for investors. By integrating these principles, the study highlights how Markowitz's theory remains a cornerstone of portfolio management, enabling investors to construct efficient and resilient portfolios that align with their financial goals and risk tolerance. |
