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Contributors
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- By Ghazi Al-Rawas, Vazken Andréassian, Tianqi Ao, Stacey A. Archfield, Berit Arheimer, András Bárdossy, Trent Biggs, Günter Blöschl, Theresa Blume, Marco Borga, Helge Bormann, Gianluca Botter, Tom Brown, Donald H. Burn, Sean K. Carey, Attilio Castellarin, Francis Chiew, François Colin, Paulin Coulibaly, Armand Crabit, Barry Croke, Siegfried Demuth, Qingyun Duan, Giuliano Di Baldassarre, Thomas Dunne, Ying Fan, Xing Fang, Boris Gartsman, Alexander Gelfan, Mikhail Georgievski, Nick van de Giesen, David C. Goodrich, Hoshin V. Gupta, Khaled Haddad, David M. Hannah, H. A. P. Hapuarachchi, Hege Hisdal, Kamila Hlavčová, Markus Hrachowitz, Denis A. Hughes, Günter Humer, Ruud Hurkmans, Vito Iacobellis, Elena Ilyichyova, Hiroshi Ishidaira, Graham Jewitt, Shaofeng Jia, Jeffrey R. Kennedy, Anthony S. Kiem, Robert Kirnbauer, Thomas R. Kjeldsen, Jürgen Komma, Leonid M. Korytny, Charles N. Kroll, George Kuczera, Gregor Laaha, Henny A. J. van Lanen, Hjalmar Laudon, Jens Liebe, Shijun Lin, Göran Lindström, Suxia Liu, Jun Magome, Danny G. Marks, Dominic Mazvimavi, Jeffrey J. McDonnell, Brian L. McGlynn, Kevin J. McGuire, Neil McIntyre, Thomas A. McMahon, Ralf Merz, Robert A. Metcalfe, Alberto Montanari, David Morris, Roger Moussa, Lakshman Nandagiri, Thomas Nester, Taha B. M. J. Ouarda, Ludovic Oudin, Juraj Parajka, Charles S. Pearson, Murray C. Peel, Charles Perrin, John W. Pomeroy, David A. Post, Ataur Rahman, Liliang Ren, Magdalena Rogger, Dan Rosbjerg, José Luis Salinas, Jos Samuel, Eric Sauquet, Hubert H. G. Savenije, Takahiro Sayama, John C. Schaake, Kevin Shook, Murugesu Sivapalan, Jon Olav Skøien, Chris Soulsby, Christopher Spence, R. ‘Sri’ Srikanthan, Tammo S. Steenhuis, Jan Szolgay, Yasuto Tachikawa, Kuniyoshi Takeuchi, Lena M. Tallaksen, Dörthe Tetzlaff, Sally E. Thompson, Elena Toth, Peter A. Troch, Remko Uijlenhoet, Carl L. Unkrich, Alberto Viglione, Neil R. Viney, Richard M. Vogel, Thorsten Wagener, M. Todd Walter, Guoqiang Wang, Markus Weiler, Rolf Weingartner, Erwin Weinmann, Hessel Winsemius, Ross A. Woods, Dawen Yang, Chihiro Yoshimura, Andy Young, Gordon Young, Erwin Zehe, Yongqiang Zhang, Maichun C. Zhou
- Edited by Günter Blöschl, Technische Universität Wien, Austria, Murugesu Sivapalan, University of Illinois, Urbana-Champaign, Thorsten Wagener, University of Bristol, Alberto Viglione, Technische Universität Wien, Austria, Hubert Savenije, Technische Universiteit Delft, The Netherlands
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- Book:
- Runoff Prediction in Ungauged Basins
- Published online:
- 05 April 2013
- Print publication:
- 18 April 2013, pp ix-xiv
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- Chapter
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Extensions to Portfolio Theory to Reflect Vast Wealth Differences among Investors
- Christopher A. Hessel
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- Journal:
- Journal of Financial and Quantitative Analysis / Volume 16 / Issue 1 / March 1981
- Published online by Cambridge University Press:
- 06 April 2009, pp. 53-70
- Print publication:
- March 1981
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- Article
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Much of modern portfolio theory rests on conclusions drawn from the original form of the Capital Asset Pricing Model. Fundamental to the conclusions of this model is the assumption of perfect competition among investors; i.e., all investors possess approximately the same small amount of wealth such that equilibrium price cannot be influenced significantly by the demand of any of the investors. Today's security market, however, is characterized by individuals and large institutional investors such as insurance companies and investment funds. Although institutions represent a very small fraction of all investors in the market, institutional investors in 1977 held 34.3 percent of all outstanding stock. By the very magnitude of the dollar transactions effected by these large investors, prices can and are affected dramatically. Because today's security market is composed of investors exhibiting extreme differences in wealth, the United States securities market probably is not perfectly competitive as assumed in portfolio theory. Consequently, investment theory must be extended to reflect vast wealth differences among investors. To achieve this end, modifications are made to the original Capital Asset Pricing Model. Equilibrium conditions are examined and conclusions are drawn as to how portfolio theory must be altered to include price affecting ability by a segment of the investors in the market.