A Simplified Perspective of the Markowitz Portfolio Theory

ArXiv ID: ssrn-2147880 “View on arXiv”

Authors: Unknown

Abstract

Noted economist, Harry Markowitz (“Markowitz) received a Nobel Prize for his pioneering theoretical contributions to financial economics and corporate finance.

Keywords: Harry Markowitz, Modern Portfolio Theory, Asset Allocation, Risk-Return Trade-off, Equities

Complexity vs Empirical Score

• Math Complexity: 3.0/10
• Empirical Rigor: 2.0/10
• Quadrant: Philosophers
• Why: The paper presents a simplified perspective of Markowitz’s theory and focuses on using Excel as a computational shortcut, indicating low mathematical density and minimal empirical backtesting or data-heavy implementation.

  flowchart TD
    A["Research Goal<br>Test Simplified MPT Approach"] --> B["Input Data<br>Historical Equity Returns"]
    B --> C["Computational Process<br>Mean-Variance Optimization"]
    C --> D["Core Calculation<br>Efficient Frontier Construction"]
    D --> E["Output<br>Risk-Return Efficient Portfolios"]
    E --> F["Key Finding<br>Validation of Risk-Return Trade-off"]
    F --> G["Outcome<br>Practical Asset Allocation Tool"]