# Category: investments

• ## What is the market portfolio?

The market portfolio is the market value-weighted portfolio of all risky assets in an economy. In this post, we show how the market portfolio is equivalent to the optimal risky portfolio when all investors behave according to the modern portfolio theory. Learning objectives Moving from the optimal risky portfolio to the market portfolio According to […]

• ## What is the optimal risky portfolio?

In the previous post, we explained that when there is no risk-free asset in an economy, investors should invest in one of the efficient portfolios that lie on the efficient frontier based on their risk tolerance. We added that, if a risk-free asset exists, then there is a unique efficient portfolio that all investors should […]

• ## The risk of a portfolio – Calculator and formula

We often say that risk and return are two sides of the same coin. You can’t discuss one without the other. In the previous post, we showed you how to calculate the return on a portfolio of assets. In this post, we explain the formula for portfolio risk. We also offer an easy-to-use portfolio risk […]

• ## Portfolio return calculator and formula

In this post, we explain the formula behind the calculation of portfolio returns. Furthermore, we provide a free online portfolio return calculator, which works as a portfolio expected return calculator as well as a portfolio realized return calculator. Finally, with this port, we make an introduction to the modern portfolio theory as well. So far […]

• ## Expected return calculator and formula

When evaluating an asset’s past performance, we can make use of the historical (or realized) average return. In that sense, the historical average return is a backward-looking measure. But, in order to forecast an asset’s future performance, we need a forward-looking measure. This measure is called the expected return. In this post, we explain the […]

• ## Holding period return calculator and formula

In this post, we explain the holding period return formula with examples and offer an easy-to-use holding period return calculator. When investors buy securities (e.g., stocks), they may hold them for months or years before selling them. The duration during which an investor holds on to a particular security is known as the holding period […]