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The Power Of An Actively Managed Portfolio: An Empirical Example Using The Treynor-Black Model, Alexander D. Brown

Honors Theses

The focus of this thesis is to examine the added benefits of actively managing a portfolio of securities from an individual investor's perspective. More specifically, managing a market portfolio with the combination of a selected few actively managed securities can, in some instances, create excess return. The active portfolios are formed based on the firms' specific industries or region in which they operate. The idea is that an investor can forecast that a specific industry will outperform or underperform other industries during different periods in the market. Using the investor's forecasts can provide excess returns if the forecast is accurate. …