Review of Literature of Risk Analysis in Portfolio Management

REVIEW OF LITERATURE * Ananth N Madhavan (2003) once a fairly esoteric subject, risk analysis and measurement have become a critical function for both portfolio managers and traders. Yet accurate measurement and analysis of risk presents many practical challenges, including the choice of risk model, portfolio optimization pitfalls, horizon mismatches, and out-of-sample testing. This detailed overview of recent developments in risk analysis and modeling focuses on practical applications.
While risk management tools can provide invaluable insights as to portfolio risk, they must be applied with considerable care. Risk analysis, as it stands today, is as much an art as a science. * Peter Brooke (2009) suggested that the easiest way to build a very diverse portfolio is via investment funds. The choice of funds is now enormous and nearly every asset class is covered by them.
This means it is very easy and inexpensive to put several funds together and have a very broad spread. There are now some very good ‘multi asset’ funds which provide exposure to all of these different classes in one professionally managed place. These multi asset managers may also be able to access some funds which are still not available to the retail investor, such as private equity. Peter Brooke is a financial planner to the English speaking expatriate community.


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This article (Portfolio Construction) was published in the July 2009 edition of Dockwalk magazine * Anita Bhoir, (2011)Portfolio construction& services offered by banks and brokerages to face heat ; MUMBAI : Regulators may put an end to discretionary portfolio management services offered by banks and brokerages after a series of frauds, including high-profile ones at City and Standard Chartered, said a person familiar with the thinking.
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RBI, SEBI and a sub-committee of the Financial Stability and Development Council are working on the proposed guidelines for portfolio management, said the person requesting anonymity. “RBI is likely to ask banks to stop discretionary portfolio management,” said the person. * RaghavanR. S, (2011) -Core and satellite portfolio construction& evaluation a popular investment method ; the seznsex has not been in the pink of health for a week now. The steep fall in the global indices and teetering economies have been weighing on the Indian quity market, which, in turn, has dented the value of equity portfolios. It’s in times like these that the benefits of the core and satellite strategy towards investing become obvious. How it works the core and satellite portfolio management is a popular form of investment strategy with money managers and their clients. * ET Bureau, (2011), How to pick a portfolio construction ; evaluation scheme; Equity portfolio management schemes (PMS) are today quite attractive from the perspective of high net worth individuals (HNIs) or ultra HNIs.
However, investor and distributor awareness of this product category is quite low and one must understand the benefits of using this mode for investing. Typically, the minimum application size in PMS products is rather high? With the minimum being Rs 10 lakh and some even having ticket sizes running into crore. Most equity PMS products could involve a slightly higher degree of risk as they are offered to investors who desire that extra bit of return.

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