Author: Yuliya A. Konoplyova

Abstract:

The article deals with the evolution of views on the formation of effective investment portfolio. The paper discusses classic theories of the formation of effective portfolio of securities, namely the theories developed by H. Markowitz, W. Sharpe, CAPM and arbitrage pricing theory. The advantages and disadvantages of the theories are described. H. Markowitz laid the foundations for solving the problem of optimal allocation of capital shares between securities helping to keep overall risk to a minimum and formation of optimal portfolio in the 1950s. In 1963, W. Sharpe continued analysis of the efficiency of securities market. In the 1970s he, J. Lintner and Ya. Mossin developed CAPM theory to determine the share price or company value in the future. Another achievement in the field of portfolio investment was arbitrage pricing theory formulated by S. Ross in the 1970s.

Keywords: investment; portfolio; securities; efficiency; equity market.