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Rutterford, Janette and Sotiropoulos, Dimitris P.
(2016).
DOI: https://doi.org/10.1080/09672567.2016.1203968
Abstract
The paper offers textual evidence from a series of financial advice documents in the late nineteenth century and the early twentieth century of how UK investors perceived of and managed risk. In the world’s largest financial centre of the time, UK investors were familiar with the concept of correlation and financial advisers’ suggestions were consistent with the recommendations of modern portfolio theory in relation to portfolio selection strategies. From the 1870s, there was an increased awareness of the benefits of financial diversification - primarily putting equal amounts into a number of different securities - with much of the emphasis being on geographical rather than sectoral diversification and some discussion of avoiding highly correlated investments. Investors in the past were not so naïve as mainstream financial discussions suggest today.
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About
- Item ORO ID
- 46801
- Item Type
- Journal Item
- ISSN
- 1469-5936
- Keywords
- diversification; Markowitz; portfolio theory; portfolio risk; capital flows; B10; B30; G11
- Academic Unit or School
-
Faculty of Business and Law (FBL) > Business > Department for Accounting and Finance
Faculty of Business and Law (FBL) > Business
Faculty of Business and Law (FBL) - Research Group
- Innovation, Knowledge & Development research centre (IKD)
- Copyright Holders
- © 2016 Informa UK Limited
- Depositing User
- Dimitris Sotiropoulos