What are portfolio problems?

Answer 1

Portfolio problems refer to the challenges associated with selecting and managing a collection of investments, such as stocks, bonds, or other assets, to optimize returns while minimizing risk. These problems often involve determining the best asset allocation, balancing risk and return, and addressing constraints like liquidity, time horizon, and individual investor preferences. Techniques such as Modern Portfolio Theory and various optimization algorithms are commonly used to tackle these issues. Ultimately, the goal is to create a diversified portfolio that meets the investor's financial objectives.