Elements of Portfolio SAFe®

The concept of Portfolio Management has its origins in modern portfolio theory (MPT), introduced by economist Harry Markowitz in an essay he wrote in 1952, entitled Portfolio Selection. MPT provides a mathematical framework to analyze a portfolio of assets to maximize the expected returns across identified levels of risk. Markowitz applied his MPT concepts as a risk management strategy to diversify financial assets within a broader investment portfolio. He won a Nobel Prize in Economics for his work in this area.

In a modern context, the word portfolio describes a combination of financial, intellectual, and physical assets held by investors, financial institutions, and business enterprises. Portfolio management is the discipline organizations implement to both select and oversee their investments, in whatever form those investments might take, that is, securities, facilities, property, equipment, technologies, IT systems, supply chain and delivery...