Portfolio optimization tool

You have a demonstration tool here: you just need to choose among the available assets, which ones you want to put in your portfolio. The click “Optimize” and I will show you what combination gives the highest reward to risk ratio. This analysis is based on market data from a period of less than 10 years and serves only for demonstration of the basic portfolio optimization concept.

The vertical axis is the expected annual return and the the horizontal axis represents the volatility of the portfolio (standard deviation). The blue circles show the position of the assets that you have chosen. Then, the program checks many possible portfolios with different weights for the chosen stocks , and then plots them as green dots. These portfolios are generated randomly and then evaluated in terms of return and volatility. The one that has the highest return/volatility rate, is marked by a red circle. The weights of this optimum portfolio are indicated on the top of the graph in percent.

To read more about the theory and see how this graph can be constructed, check my video on the subject: Finance 01: Modern portfolio optimization theory and Ray Dalio’s All Weather portfolio

Choose what you want to have in the portfolio:
hold CTRL for multiple selection