Post Modern Portfolio Theory
Subject: Finance | Topics:

Post Modern Portfolio Theory uses the standard deviation of negative returns as the measure of risk, while modern portfolio uses the standard deviation of all returns as a measure of risk. It is an extension of the traditional modern portfolio theory “MPT”, which is an application of mean-variance analysis or “MVA”. The differences between risk, as defined by the standard deviation of returns, between the post-modern portfolio theory and modern portfolio theory is the key factor in portfolio construction. It was created in 1991 by software entrepreneurs Brian M. Rom and Kathleen Ferguson.

Related Finance Paper: