Modern Portfolio Theory
/ˈmɒdərn pɔːrtˌfoʊlioʊ ˈθɪəri/
Definitions
- (n.) A financial theory advocating portfolio diversification to optimize risk and return, often referenced in legal contexts concerning fiduciary duties and investment regulation.
The trustee applied modern portfolio theory to fulfill their duty of prudence in managing the trust assets.
Forms
- modern portfolio theory
Related terms
See also
Commentary
In legal drafting, referencing modern portfolio theory underscores adherence to recognized financial principles in investment decision-making, particularly under fiduciary standards.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.