Adequate Decision Rules for Portfolio Choice Problems
ISBN/ASIN: 0333994329,9780333994320 | 2002 | English | pdf | 130/129 pages | 3.04 Mb
Publisher: Palgrave Macmillan | Author: Thilo Goodall
The author presents the theory of portfolio choice from a new perspective, recommending decision rules that have advantages over those currently used in theory and practice. Portfolio choice theory relies on expected values. Goodall argues that this dependence has a historical basis and argues that current decision rules are inadequate for most portfolio choice situations. Drawing on econometric solutions proposed for the problem of forecasting outcomes of a chance experiment, the author defines adequacy criteria, and proposes adequate decision rules for a variety of situations.