The Use of a Simplified Markowitz Model in Choosing a Profitable Portfolio

Alexandru Cristian Dobre ()
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Alexandru Cristian Dobre: University of Petrosani

Ovidius University Annals, Economic Sciences Series, 2020, vol. XX, issue 2, 897-902

Abstract: The aim of this research is to improve investment processes in the capital market, so that the decisions taken are the best, at the best time and at the best price in line with the risk factor. In this paper we present a simplified model of Harry Markowitz, using Microsoft Excel. By gathering public data on the shares of selected companies as being in the current economic trend, over a period of 6 months, we are able to make a prediction of the amount of these shares in a profitable portfolio using the Markowitz model. For the portfolio manager, it is sufficient for the client investor of the respective investment fund to formulate concretely its requirements regarding the minimum accepted return level and the model allows the identification of such a portfolio structure that determines the obtaining of this level of the indicator in minimum risk conditions.

Keywords: portfolio; Markowitz; return (search for similar items in EconPapers)
JEL-codes: G11 (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:ovi:oviste:v:xx:y:2020:i:2:p:897-902

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