Portfolio Optimizer Pro™ is the Internet's premier implementation of the Markowitz Efficient Frontier model, a Nobel Prize-winning economic model which has the potential to allow you to maximize your yield or minimize your risk for a specific combination of securities.

In 1952, Vol. 7, Issue 1 of the Journal of Finance contained an article titled “Portfolio Selection” by economist Harry Markowitz.  In the article, Dr. Markowitz discussed the ideas of portfolio risk, diversification, and correlation of returns on assets. Using standard deviation of returns as the measure of portfolio risk, Dr. Markowitz showed that, by choosing assets whose returns are not perfectly positively correlated, the risk of a portfolio can be lowered while maintaining or increasing the expected return.

The article defined a Markowitz Efficient Portfolio as one with minimum risk for a given level of return, and maximum return for a given level of risk: no additional diversification can improve a Markowitz Efficient Portfolio for a given return or a given level of risk. The set of all Markowitz Efficient Portfolios constitutes the Markowitz Efficient Frontier: risk/return combinations above the Frontier are not possible, and risk/return combinations below the Frontier are not efficient.

Dr. Markowitz was awarded the Nobel Prize in Economics in 1990 for his pioneering work, which forms a cornerstone of Modern Portfolio Theory.

Portfolio Optimizer Pro™ allows you to take advantage of this theory in a practical way and apply this valuable modeling technique to your own portfolio!