Harry Markowitz's work on investing will shape us forever

Harry Markowitz passed away this week at the age of 95. His numerous works on investing will leave their mark on us forever. They are a direct or indirect component of almost every book devoted to the subject of investment. His work on portfolio theory in the 1950s was highly influential, and is just one example of his many groundbreaking works: Harry Markowitz established that the fluctuation of a portfolio with several stocks can be smaller than the fluctuation of each stock alone: The diversification effect!"One might conjecture that the variability of return on a portfolio can, similarly, be no smaller than that of the least variable security in the portfolio. But this is not so."

Video recommendation: Interview by Frank Fabozzi with Harry Markowitz in 2020