The sample file for this video contains all of the data and summary formulas we need to find the optimal portfolio chosen from a set of investments and for a given level of risk.
- [Instructor] In the previous movie…I showed you how to create a Solver model…to find the portfolio with the highest return…for a given level of risk.…In this movie, I will change some of the constraints…so you can see how they affect the model.…My sample file is the Investments_05 workbook…and you can find it in the Chapter Two folder…of the exercise files collection.…Just to review, we found the solution…where we have investments among four funds…and based on the proportions that you see here,…the summary formula in cell E11…finds the sum of all the values…and we see that we have one,…which means that we are 100% invested.…
The total beta for the portfolio of 1.3…matches the target and we see here,…the expected value.…I have also recorded the expected value in cell C17 as 5.3.…Now let's see what happens…if I change the target beta to 1.4.…So, in cell C12 I will change the value from 1.3 to 1.4,…and press Enter.…Now we need to re-run the model,…so I'll go to the Data tab…and click Solver at the far right side.…
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- Finding target values using Goal Seek
- Finding a solution using Solver
- Tuning investment portfolios
- Organizing worksheets
- Creating objective and control formulas
- Experimenting with different constraints
- Optimizing resource placement
- Defining decision trees