I bet that almost all policy and decision-makers have a direct or indirect investment portfolio. Most investment portfolios are diversified across a variety of stocks and bonds to minimise risk, to preserve capital and generate returns. Diversification is a well-established mechanism to protect a portfolio from volatility to the same events. In addition, a smart investment portfolio has a long-term game plan, it is continually interrogated and adjusted when required. Modern portfolio theory (MPT) suggests that "... an investment's risk and return characteristics should not be viewed alone but should be evaluated by how the investment affects the overall portfolio's risk and return".
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Source water supply diversification - investing for the future
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