DTF: Indexing the world through DeFAI
  • The Birth of $DTF
    • The Driving Purpose
    • Cross-Chain: Solana & Base
  • Indexing the World with DeFAI: Agent Franklin
    • Key Objectives
    • Why DeFAI Agent Franklin?
    • What Franklin Offers
  • Getting Started
    • Step 1: Accessing the Platform
    • Step 2: Exploring the Features
    • Step 3: Start Investing
  • Core Functionalities
    • Sentiment Analysis
    • Portfolio Optimization
    • Twitter Agent
    • Performance Reporter
    • Token-Gated AI Chat
    • Non-Custodial Approach
    • Future-Ready Features
  • Roadmap and Future Plans
    • Immediate Roadmap
  • Technical Overview
    • Portfolio Optimization Algorithms
    • Security and Non-Custodial Design
    • Developer Tooling and APIs
  • Explainer: Modern Portfolio Theory (MPT)
    • Historical Background
    • Key Concepts
    • Application in Franklin AI
    • Why MPT Matters
  • Frequently Asked Questions (FAQ)
    • General Questions
    • Features and Functionality
  • Terms and Conditions
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  1. Explainer: Modern Portfolio Theory (MPT)

Historical Background

Harry Markowitz introduced MPT in his seminal paper, "Portfolio Selection," published in the Journal of Finance.

He argued that investors could achieve optimal portfolios by balancing risk and return, considering the correlation between asset performances.

In 1990, Markowitz was awarded the Nobel Prize in Economic Sciences for his contributions.

Before MPT, investment strategies often focused on selecting individual securities.

Markowitz's theory shifted the focus to portfolio-level optimization, emphasizing diversification to minimize risk.

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Last updated 4 months ago