Portfolio construction distinguishes itself as the phase in which all the efforts of various investment professionals come together to create the portfolio best suited for the client. In addition to the work performed in the Security Assessment phase of the Investment Process, the Portfolio Construction phase brings together three analytical tasks of a more global nature: Asset Allocation, Sector Analysis, and Risk Management.
Firms that place their primary emphasis on the Portfolio Construction phase believe there are forces at work at the market level, the asset class level, and at the sector level that are more than just the sum of the micro factors driving individual securities. Hence the focus of this chapter is on those firms that place an added priority on macro level thinking in the construct of their client portfolios.
This chapter uses macro level data sets to cover a range of Portfolio Construction activities that reflect on macro level thinking. It starts with a review of the efficient frontier to discuss the diversification space of asset allocation. Next, we review sector leadership data: One data set presents 20 years of sector performance ranking and another includes 22 alpha factors. Our last section on risk management involves multiple data visualizations: One set presents better methods to showcase the overlap of holdings ...
Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month, and much more.
O’Reilly covers everything we've got, with content to help us build a world-class technology community, upgrade the capabilities and competencies of our teams, and improve overall team performance as well as their engagement.
Julian F.
Head of Cybersecurity
I wanted to learn C and C++, but it didn't click for me until I picked up an O'Reilly book. When I went on the O’Reilly platform, I was astonished to find all the books there, plus live events and sandboxes so you could play around with the technology.
Addison B.
Field Engineer
I’ve been on the O’Reilly platform for more than eight years. I use a couple of learning platforms, but I'm on O'Reilly more than anybody else. When you're there, you start learning. I'm never disappointed.
Amir M.
Data Platform Tech Lead
I'm always learning. So when I got on to O'Reilly, I was like a kid in a candy store. There are playlists. There are answers. There's on-demand training. It's worth its weight in gold, in terms of what it allows me to do.
O’Reilly covers everything we've got, with content to help us build a world-class technology community, upgrade the capabilities and competencies of our teams, and improve overall team performance as well as their engagement.
