21.03.2023
Very good course from ivan.
Portfolio Management
with
Ivan Kitov
Unlock the secrets of successful portfolio management with our comprehensive Portfolio Management course. Learn the art and science of selecting and managing investments for maximum returns within your desired investment horizon. Gain the skills and confidence to make informed investment decisions and reach your financial objectives.
7 hours 79 lessons
Start course
79 High Quality Lessons
31 Practical Tasks
7 Hours of Content
Certificate of Achievement
Course Overview
Deciding how to invest one’s capital is no easy feat. For starters, you need to consider the goal of the investment. Individuals might want to save for retirement, while institutions need a portfolio to meet their ongoing and future spending needs. Regardless of the objectives, the choice of assets is overwhelmingly diverse. Portfolio managers are trained to navigate this complex field and select the investments that generate the lowest risk and highest return possible. This Portfolio Management course will teach you the theory behind optimal portfolio construction and introduce you to the best practices in portfolio management and performance evaluation. We examine in detail the individual and portfolio approaches to investing, the portfolio management process, the different types of investors and their needs, the asset management industry, and the existing pooled investment vehicles. By the end of the Portfolio Management course, you will be able to calculate and interpret the two most common measures of portfolio returns: money-weighted and time-weighted rate of return. We also show you the instruments that characterize the investment opportunities available today and how to find the mean, variance, and correlation of asset returns using historical data. The next step is learning how to apply this knowledge to optimize the portfolio selection process. You will learn why you shouldn’t put all your eggs in one basket and how imperfect correlation between assets leads to diversified portfolios. We continue with the implications of risk aversion and how to shape an investor's profile by combining the optimal risky portfolio and the risk-free asset. The topic ends with a practical example of building a five-asset portfolio in Excel using matrix algebra and the Markowitz optimization process to find the optimal risky portfolio. Next, we explain why investors should not be compensated for bearing nonsystematic risk. We discuss the difference between the Capital Allocation Line (CAL) and the Capital Market Line (CML) and introduce the Capital Asset Pricing Model (CAMP). Armed with the right return-generating model, you will learn how to calculate the expected return of an asset. Then, we change gear and study investment policy statements from a practical perspective. We begin with the prominence of written statements and continue with the importance of distinguishing between the willingness and the ability to take risks when analyzing an investor’s financial risk tolerance. We also touch on ESG investing and how it can be integrated into portfolio planning and construction. The last part of the Portfolio Management course is dedicated to risk management. We explain why a firm’s risk management division doesn’t work toward total risk elimination. On the contrary—every business needs to take risks to perform its core operations. So, the risk management team’s role is to alert to and quantify the types of risks a company is currently exposed to. Designed for portfolio managers and investment professionals, this course equips you with the expertise and skills to select and manage investments. Learn how to reach your financial goals with ease. Don't wait—enroll now and master the art of portfolio management.
Topics covered
Capital MarketsExcelFinance FundamentalsInvestment AnalysisPortfolio OptimizationPortfolio Мanagement
What You'll Learn
In this Portfolio Management course, we cover the basic theory that every portfolio manager needs to know and show you how to apply it in practice using real-world examples. More specifically, we help you:
Understand fundamental concepts of financial markets and market participants
Build the efficient frontier in Excel
Measure your investment portfolio's performance by calculating risk and return
Understand the concepts of correlation and diversification
Interpret the Modern Portfolio Theory and use the Capital Asset Pricing Model to determine expected return on equity in stock valuation models
Calculate the Sharpe and Treynor ratios, as well as indicators like M2 and Jensen’s alpha
Curriculum
- Portfolio Management: Overview10 Lessons 62 Min
In this introductory section, we provide an overview of the asset management industry. We begin with the portfolio approach and how it helps investors achieve their financial objectives. Then, we outline the steps in the portfolio management process, describe the different investor types, and compare their financial needs. Next, we focus on defined contribution and defined benefit pension plans. Finally, we discuss mutual funds and how they compare to other pooled investment vehicles that asset managers offer.
Course Introduction FreePortfolio Approach FreePortfolio Management Process FreeTypes of InvestorsDC and DB plansThe Asset management IndustryMutual FundsSMAs and ETFsHedge FundsPrivate Equity - Portfolio Risk and Return (Part 1)28 Lessons 123 Min
This section of the Portfolio Management course covers the basics of the major return measures. We start with the calculations, then we highlight the key differences between them. The most important factors we need to consider when creating a portfolio are the risk and return of the individual assets. In this section, you will learn how to calculate and interpret the mean, variance, and covariance of asset returns. We also discuss the main types of investors and their risk-return preferences. Then, we delve deeper into the role of correlation in determining a portfolio’s risk. And finally, we describe the efficient frontier of risky assets and the global minimum-variance portfolio.
Holding Period Return (HPR)How to download historical price data in Excel using Yahoo FinanceHow to format an Excel SpreadsheetLog Return (Bonus)Arithmetic vs Geometric Mean ReturnHow to calculate rates of return in ExcelMoney-weighted rate of returnTime-weighted rate of returnMoney-weighted vs time-weightedAnnualized returnThe Effect of Fees, Taxes, Inflation and LeverageMajor Asset ClassesHistorical vs Expected ReturnsMean, Variance and Covariance of Asset ReturnsVariance and Standard Deviation of Returns (Excel)Covariance and Correlation between two assets (Excel)Risk AversionRisk Aversion (Implications)Portfolio Risk and ReturnPortfolio Risk and Return (Excel)The Correlation CoefficientInvestment Opportunity SetMinimum-Variance FrontierMinimum-Variance Frontier (Excel)Capital Allocation LineOptimal Risky Portfolio (Excel)Capital Allocation Line (Excel)Optimal Investor Portfolio - Practical Example8 Lessons 36 Min
To earn a portfolio management certificate, you need not only theoretical knowledge but practical experience as well. So, in this section, we calculate the risk and return of a five-asset portfolio in Excel. Then, using matrix algebra and the Markowitz optimization process, we find the minimum variance and optimal risky portfolio.
IntroductionWhat is a matrix?Scalars and vectorsThe Transpose of Vectors and MatricesDot productPortfolio Variance (Multi-Asset Case)Variance-Covariance MatrixOptimal Risky Portfolio - Portfolio Risk and Return (Part 2)15 Lessons 78 Min
Our goal in this section of the Portfolio Management training is to identify the optimal risky portfolio by using the Capital Asset Pricing Model. We lay the foundations by discussing the consequences of combining a risk-free asset with the market portfolio and some key concepts to help you see the big picture. Then, we explain the differences between Capital Allocation Line and Capital Market Line. We decompose total risk into systematic and nonsystematic risk and discuss their characteristics. After building the necessary theoretical background, we calculate the expected return of an asset. Finally, we examine the security market line and its applications and cover some of the most popular measures for evaluating the performance of a portfolio.
Two-fund Separation TheoremCapital Allocation Line (CAL) vs. Capital Market Line (CML)Systematic vs. Unsystematic RiskReturn-generating ModelsCalculate and Interpret BetaRegression analysisCalculate Beta in ExcelCapital Asset Pricing Model (CAPM)Security Market Line (SML)Expected Return (CAPM)CAPM (Applications)Sharpe Ratio and M2 RatioTreynor Ratio and Jensen’s AlphaPerformance Measures (Example)Performance Measures (Excel) - Basics of Portfolio Planning and Construction9 Lessons 41 Min
In this section, we study investment policy statements from a practical perspective. First, we discuss the importance of written statements and break down the concept into its constituent parts. We move on to the investor’s risk and return objectives, the difference between the ability and willingness to take risks, and the resulting investment and portfolio management constraints. Next, we examine the various asset classes and their role in strategic asset allocation. Lastly, we describe the principles of portfolio construction and the extent of ESG integration into the investment processes.
Investment Policy Statement (IPS)IPS ComponentsRisk and Return ObjectivesWillingness vs. Ability to take riskInvestment ConstraintsAsset AllocationPortfolio Construction (Principles)Tactical Asset AllocationESG Investing - Introduction to Risk Management9 Lessons 20 Min
After the 2008 financial crisis and the 2001 Enron scandal, risk management became an integral part of the decision-making process of investors and companies. In the last section of the Portfolio Management training, we discuss the definitions and elements of effective risk management, governance, and budgeting. Next, we examine the differences and interactions between financial and non-financial sources of risk. At the end of the Portfolio Management course, we present the ways of modifying risk exposures.
Risk Management (Definition)The Risk Governance ProcessRisk ToleranceRisk BudgetingFinancial and Non-financial Sources of RiskRisk Measures (Part 1)Risk Measures (Part 2)Subjective and Market-based Risk EstimatesRisk Management Framework
Student feedback
Filter by rating
- 5 stars
- 4 stars
- 3 stars
- 2 stars
- 1 stars
Sort
- Newest
- Oldest
- 1
- 2
- 3
“Constructing an optimal portfolio is an essential task for every investor. It’s how money makes more money!”
Ivan Kitov
COO at 365 Data Science
Portfolio Management
with Ivan Kitov