Mean Variance Portfolio Theory Simply Explained
Channel: MJ the Fellow Actuary
Date: 2017-04-21

I struggled with this concept back at University and I hope this video clears up your understanding. I explain it at a high level without going into mathematical detail. The basic principle is that you can reduce risk and increase return with diversification. Although as actuaries we tend to shy away from this model as it doesn't take account of liabilities. In fact, actuaries have shown that a less risky portfolio can be constructed that is not on the efficient frontier! How is this possible? Subscribe to my channel as I'm planning on releasing a video about it in the future.

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