PORTFOLIO MANAGEMENT AND ITS IMPACT ON PROFITABILITY LEVEL OF BANKS IN NIGERIA

PORTFOLIO MANAGEMENT AND ITS IMPACT ON PROFITABILITY LEVEL OF BANKS IN NIGERIA

LITERATURE REVIEW
2.2. CONCEPTUAL REVIEW
2.2.1 CONCEPT OF ASSET PORTFOLIO MANAGEMENT
The dictionary of accounting defined portfolio as the collection of different
securities or other assets held by an individual or an institution which can be
evaluated interns of their combined risk and return. This risk of a portfolio does not depend nor any on the risking or security bills also on the relationship
among the securities.
For a proper understanding of the frame work upon which this study is based, it is inevitable to highlight it. The contribution made by earlier writer on
portfolio management foremost among these is the work of Professor Harry mackowitz (the portfolio management in journal of Finance (1952) and portfolio
selection “eicient
diversification of investment 1959).
His assertion were that the possess of portfolio selection could be of two fold.
Starting with their observation and experience that end with belief about the future performance that end of available securities and Starting with relevant
belief about the performance that end with the choice of portfolio.
In general maxrkowitz and Adesota (1995) identify here factors that determine the eiciency
of portfolios selection theory. These are:
The expected future return of each candidate security.
The expected risk of each candidate’s security.
The extent to which each security’s risk correlated with every other security.
From the evaluation of the entire potolio was the return one expects from the portfolio and associated risk of portfolio.
He believed those portfolios are created to diversify holdings of wealth to achieved low risk and high returns from these it is obvious that the ultimate aim of
an investor is to minimize risk without necessary reducing the returns from investment.
The following those portfolios are created to diversify holding of wealth to achieved low risk and high returns from these it is obvious that the ultimate aim of
an investor is to minimize risk without necessary reducing the returns from investment.
The following assumptions were made for our study:

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PORTFOLIO MANAGEMENT AND ITS IMPACT ON PROFITABILITY LEVEL OF BANKS IN NIGERIA