About This Chapter
Overview of Portfolios - Chapter Summary
This overview of portfolios can help you understand the basic components of modern portfolio management and theory. Entertaining lessons provide in-depth examinations of topics that include behavioral finance, modern portfolio theory and quantitative behavioral finance. Completing this chapter will enable you to:
- Explain how investment policy statements are developed in the planning stage of investment planning
- List and describe the fundamental components of portfolio management
- Define and provide examples of modern portfolio theory (MPT)
- Discuss the development, analysis, asset allocation and diversification of investment portfolios
- Share the definition and applications of behavioral finance
- Identify and describe methods of quantitative behavioral finance
Enjoy the flexibility this chapter offers by accessing any number of lessons in your sequence of choice. All lessons are available 24/7 and can be viewed using a computer or mobile device with an Internet connection. Check your understanding of the lessons you view by taking accompanying quizzes. A practice exam can test your overall understanding of portfolios.
1. Basic Components of Portfolio Management
This lesson discusses the basics of portfolio management and goes on to explore its basic components, explaining modern portfolio theory and efficient market hypothesis.
2. Modern Portfolio Theory: Definition & Examples
In this lesson, we will go over the foundations of modern portfolio theory. We will also look at how investors can use it to create an appropriate investment mix that optimizes risk.
3. Investment Portfolios: Development & Analysis
Much of the time, specific companies or an index, like the S&P or Dow Jones, are the focus of stock market chat. In this lesson, we'll learn why you should focus just as much on developing and analyzing your entire portfolio.
4. Investment Portfolios: Asset Allocation & Diversification
In this lesson, we'll review the principles of asset allocation, rebalancing, and diversification as they relate to designing a strong and stable investment portfolio.
5. Behavioral Finance: Definition & Applications
Behavioral finance is a new theory that combines behavior psychology with traditional finance theories to determine why people make irrational or rational finance decisions.
6. Quantitative Behavioral Finance: Definition & Methods
In this lesson, we will introduce the theory of quantitative behavioral finance, discuss the origin of the theory and define the term. Additionally, we will look at the use of statistical methodology to understand behavioral biases in marketing applications.
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Other chapters within the Chartered Financial Analyst (CFA): Exam Prep & Study Guide course
- About the CFA Exam
- Ethical & Professional Standards in Finance
- Quantitative Methods in Finance
- Overview of Economics in the Financial Market
- Domestic Economic Concepts
- International Trade & Currency Exchange
- Overview of Financial Reporting & Analysis
- Types of Financial Reporting & Analysis
- Understanding Corporate Finance
- Equity Investments
- Fixed-Income Securities
- Derivatives in Finance
- Alternative Investments
- Portfolio Management Strategies
- Portfolio Performance Analysis