Efficient Portfolio

The project is concerned with the analysis of the key issues in the construction and management of portfolio. It therefore looked at the issues that should engage an investor’s mind when building a portfolio. Areas of particular attention were: 1. Diversification across industry and 2. Asset Allocation. The significance of this problem – Efficient Portfolio construction – lies in the question, is diversification across industry and asset allocation worth any effort and time to investors? The information gathered from three brokerage firms and carefully analyzed provided answer to the above question. Therefore the conclusion that, an investor’s time and effort will not be in vain, if he allow the idea of portfolio diversification and asset allocation to guide his investment decision and that this can best be achieved through active portfolio management. The use of Computer Programme is recommended as and integral part of modern portfolio theory. And, that Efficient Portfolio Management can only be achieved when the capital market is well developed in providing the information need of the users.

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