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Best of The Long View: Investing

The Long View

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How Did Markowitz's Findings Change Portfolio Construction?

In one afternoon, Markowitz had worked out the two major inputs to what became modern portfolio theory correlation and the notion of mean variance optimization. The way that people thought about investments was really from the perspective of the portfolio manager or gunslingers. But something happened in that process where portfolio managers began to see a different way of constructing portfolios.

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