Portfolio Management: Theory, Behavioral Aspects and Applications

Portfolio Management: Theory, Behavioral Aspects and Application covers behavioral aspects of investing, investment strategies including buy and sell disciplines, technical analysis, plus the more standard textbook topics of systematic portfolio management, portfolio construction and analysis, security valuation and risk analysis, asset class management, portfolio applications, derivative valuation and portfolio evaluation. The behavioral topics range from psychological factors to "deadly sins" of financial decision making. As part of the behavioral aspects a brief overview of technical analysis is presented. Our goal in this book is to blend the theory of portfolio selection and asset pricing with the behavioral side of investing and introducing "pragmatic applications." This is not a book that only prescribes what portfolio managers or investors should or should not undertake. Instead it recognizes that the savings and investment process is dependent on individual choice and the decisions regarding the appropriate portfolio should be based on risk tolerance.

The first two chapters set the stage for portfolio management by presenting systematic portfolio management and behavioral aspects. These chapters help lay out the environment in which investors and portfolio managers operate. The next three chapters present modern portfolio theory, capital market theory including the capital asset pricing model, and arbitrage pricing theory. We then move into valuation of two primary asset classes, debt instruments and equity. This valuation section presents basic valuation and risk characteristics of two main asset classes, namely bonds and stocks, that are large, global, part of "everyone's portfolio," and they are the basis for many derivative instruments. Next, we turn our attention to strategies and managing portfolios for several chapters. Disciplined stock selection and tactics are presented in Chapter 9, while the most important decisions relating to portfolio management, namely asset allocation, is discussed in Chapter 10. Styles and strategies, and global investing are then presented in the next two chapters respectively. Chapter 13 presents strategies for managing bond portfolios. Our attention then turns to derivative securities in Chapters 14 and 15. The book concludes with a critical element of portfolio management, namely evaluation of performance.

If you are interested in adopting this book for your portfolio management or investments course (it has been used in both) and would like a complimentary copy please contact:
Dr. Walter J. Reinhart
Loyola University Graduate Center
2034 Greenspring Drive
Timonium, MD 21093
TEL: 410.617.1555
When you adopt the book, suggested answers to the end of chapter questions and problems will be provided, along with power point slides.