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Real Time Investments with Adequate Portfolio Theory

Author

Listed:
  • Alina Kvietkauskienė

    (Vilnius Gediminas Technical University)

Abstract

The objective of this paper is to identify investment decision making schemes using the adequate portfolio model. This approach can be employed to project investment in stocks, using the opportunities offered by the markets and investor intelligence. It was decided to use adequate portfolio theory for investment decision making, simulation of financial markets, and optimisation of utility function. In order to achieve better performance of sustainable returns in equity portfolio, different markets, and existing companies’ equities and portfolios were selected, investigating their returns based on adequate portfolio theory. The main conclusion of article suggests investigating return on individual portfolio level. Real investment is a way to make sure of the soundness of applicable strategies. The portfolios were formed from stocks of USA, German and French markets and quoted, using adequate investment portfolio system, in DNB Trade demo version, what allows monitoring of the long-term investment experiment.

Suggested Citation

  • Alina Kvietkauskienė, 2014. "Real Time Investments with Adequate Portfolio Theory," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 2(4), pages 85-100.
    • Handle: RePEc:krk:eberjl:v:2:y:2014:i:4:p:85-100
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    References listed on IDEAS

    as
    1. Harry Markowitz, 1952. "Portfolio Selection," Journal of Finance, American Finance Association, vol. 7(1), pages 77-91, March.
    2. Markowitz, Harry, 2014. "Mean–variance approximations to expected utility," European Journal of Operational Research, Elsevier, vol. 234(2), pages 346-355.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    investments; adequate portfolio; Markowitz theory; utility function; uncertainty;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G17 - Financial Economics - - General Financial Markets - - - Financial Forecasting and Simulation

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