What is Modern Portfolio Theory (MPT)?
All Modules in this toolset are written in the context of Modern Portfolio Theory (MPT). The theory suggests that rational investors will use diversification to optimize their portfolios. The goal of this toolset is to suggest rational investors a unique, optimal portfolio that can be constructed with respect to his or her risk preferences and constraints. MPT is a sound method for many investors to establish a disciplined approach to investing. It simply assumes that most investors dislike risk, and will make decisions based on maximizing returns for a risk level that is acceptable to them. Macroaxis Wealth Management Toolset is built on this very simple assumption, giving mainstream investors the tools to reduce exposure to individual asset risk by holding a diversified portfolio.
