The portfolio management models are 1) Capital Asset Pricing Model- When an asset needs to be added to an already well diversified portfolio, this is used to calculate the asset’s rate of profit or rate of return (ROI). 2) Arbitrage Pricing Theory- This highlights the relationship between an asset and several similar market risk factors. 3) Modern Portfolio Theory- Here, the ratio of each asset must be chosen and combined carefully in a portfolio for maximum returns and minimum risks.4) Value at Risk Model- It is used by financial experts to estimate the risk involved in any financial portfolio over a given period of time. 5) Jensen’s Performance Index- It is used to calculate the abnormal return of any financial asset (bonds, shares, securities) as compared to its expected return in any portfolio. 6) Treynor Index- It is used to calculate the excess return earned which could otherwise have been earned in a portfolio with minimum or no risk factors involved.

Abhijith S

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