Modern Portfolio Theory
Asset Management

How Modern Portfolio Theory Preaches Risk Aversion

Modern Portfolio Theory is an investment theory that was put forward by famed economist Harry Markowitz in 1952. He stated that risk-averse investors are able to create portfolios that will allow them to maximize their […]

CAPM Formula
Asset Management

CAPM – Calculating Expected Return

Capital Asset Pricing Model (CAPM) is a theory developed by economist William Sharpe in 1970 that details the relationship between the expected return and the risk of investing in a particular investment. The theory utilizes […]

Market Beta and Volatility
Asset Management

Explaining Market Beta

Market beta measures the systematic risk of an asset in relation to the over all movement of the market. Systematic risk refers to market risk that affects all investors. It includes macroeconomic conditions, inflation, interest […]