Talk:Financial Portfolio Optimization Methods

Revision as of 21:47, 22 September 2015

Josef: Thank you for an interesting, and already rather detailed, Wiki article.

What I struggle with is the relationship of your article with the management of project portfolios. There are in fact serious limitations to the applicability of financial portfolio theory to project portfolios, for example the assumptions that you can invest/divest into options without changing their risk/return balance, or the assumption that you can actually divest from options ("selling" a failing project will almost always be impossible, as I am not aware of a secondary market for projects). I am not sure how we can "salvage" all the details you have already produced. What I would suggest is to focus on what part of financial portfolio management theory is applicable to project portfolio management, or better, why it is not applicable.

Reviewer 1 – User: s141938

Reviewer 2 - Biankajuh

1. I have find the description of the models very accurate. Also commendable that you mention the implementations and the limitation/disadvantages of the certain Financial Portfolio Optimization Methods. Furthermore, I really like the usage of direct links to other articles and websites. It shows a very precise job and makes it easy to follow and read up in the certain topic.
2. Structural suggestions:
   1. I would suggest to write a brief abstract section for the beginning of the article. That would help the reader to find a short few sentences summary about the main aspect and purpose of this work.
   2. Did I assume correctly that the section of “Financial Portfolio Optimization Methods in PPM” is more about the history? Would it make more sense to refer on it rather as History perhaps also in the title of the section?
3. As for me, you could make the article easier to read by defining some expressions such as “assets” in the given circumstances (similarly like you defined “investor” in the same paragraph). Please also consider to define abbreviation such as MPT. (Financial Portfolio Optimization Methods in PPM)
4. The article is nicely illustrated with the pictures which help the understanding. Although, I would suggest to name them as ‘’Figure 1, 2, 3, …etc.’’ which would allow to refer to the pictures at the relevant place of the text. For example: “Figure shows an example where all the possible portfolios which are formed based on the expected return and risk relations.” - Here you could specify by saying Figure 2.
5. At the first picture entitled as “Translation of MPT criterias to PPM criterias”, you use MPT in the title and also in the article above it, however, it says MPM in the figure itself. Are MPT and MPM referring to the same subject? Could you define what they are?
6. Grammatical/Formatting hints:
   1. “Application of methods of financial portfolio optimization can help a project manager to evaluate projects taking in consideration the interaction and influence of other projects” (Financial Portfolio Optimization Methods in PPM) —> Dot is missing from the end of the sentence. Plus I would suggest to change the word order for the following: “Application of methods of financial portfolio optimization can help a project manager to evaluate projects taking the interaction and influence of other projects in consideration.”

Reviewer 3 – User: s113735

Feedback:

Formal Aspects:

• The article clearly follows the “method or tool” requirement for the wiki article
• I recognize very few spelling errors. Things I were able to find are small mistakes like omitting a word or missing a large letter in the beginning of a new sentence:

“In order [for] a business to minimize the danger of exposure to a failed project… “ “… strategic alignment and resource levelling. [A]application of such methods…”

• I am not sure I fully understand figure 1: “Tranlation of MPT criterias to PPM criterias”, maybe this can be elaborated better? You second figure is well explained and easy to understand.
• You make great use of the <math></math> tool in your article. And although the content is quite complex, it gives the article a wiki-“esque” feeling, which is good.

Content Aspects:

• The article is clearly within the topic scope, as it directly relates to a “portfolio” topic
• You clearly have extensive knowledge of the subject and your very rigid use of references show me that you back up every statement you make. Sadly, (and this is of no fault of yours or a drawback to the content of the article) most of your references are hard-copy (aka. Book) references so I do not currently have to possibility to review your sources.
• “Northwestern” part of the curve… Why not “Top left?”
• I have no idea what “[καινουριο paper CVaR]” (in the CVaR model section) is or means, maybe this is something you left by mistake in the article?
• The size, quality and references of the article are definitely up to par. It is very clear that you know much more about the topic than I ever will.

Overall conclusion:

As mentioned, it is very clear by the content and quality of the article, that you have extensive knowledge of the tools you present. The only, albeit minor, drawback is that I feel the article is not very engaging. I think the article could benefit a lot from a few “bridging” sentences about the general purpose of the models you present – some more example uses or sentences of how exactly they relate to portfolio management. I think that would really bind the article together.