Risk as a Measuring Tool and Decision Process in
Investment Portfolio Selection

This site is a part of the JavaScript E-labs learning objects for decision making. Other JavaScript in this series are categorized under different areas of applications in the MENU section on this page.

Professor Hossein Arsham   


Many decisions involve trading money now for money in the future. Such trades fall in the domain of financial economics. In many such cases, the amount of money to be transferred in the future is uncertain. Financial economists thus deal with both time and uncertainty. Often the latter is called risk.

This JavaScripts compares the performance of several investment portfolios by measuring the risk associated with each portfolio.

For each portfolio, enter the probabilities of the out come, and enter their related return values, then click on the Calculate buttons.

Do the same for all your portfolios (up to four, but use the same JavaScript afresh if you have more), then decide which one is the most desirable, based on the calculated statistics for each portfolio, you must then make your decision.

In entering your data to move from cell to cell in the data matrix use the Tab key not arrow or enter keys.






Portfolio No. 1
Probabilities

 Returns

Expected Value: Variance:
Standard Deviation: Coefficient of Variation (%):


Portfolio No. 2
Probabilities

 Returns

Expected Value: Variance:
Standard Deviation: Coefficient of Variation (%):


Portfolio No. 3
Probabilities

 Returns

Expected Value: Variance:
Standard Deviation: Coefficient of Variation (%):


Portfolio No. 4
Probabilities

 Returns

Expected Value: Variance:
Standard Deviation: Coefficient of Variation (%):



For Technical Details, Back to:
Decision Analysis with Applications


Kindly email your comments to:
Professor Hossein Arsham


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Kindly e-mail me your comments, suggestions, and concerns. Thank you.

Professor Hossein Arsham   


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