Post-modern Portfolio Theory

Post-modern portfolio theory (or PMPT) is an extension of the traditional modern portfolio theory ("MPT", which is an application of mean-variance analysis or "MVA"). Both theories propose how rational investors should use diversification to optimize their portfolios, and how a risky asset should be priced.

Read more about Post-modern Portfolio Theory:  History, Overview, The Tools of PMPT

Famous quotes containing the word theory:

    Frankly, these days, without a theory to go with it, I can’t see a painting.
    Tom Wolfe (b. 1931)