An approach to calculate the upper limit to any given portfolio with s assets (corporate stocks or government bonds) in it is provided, which does not require the relative weight of each asset in the portfolio. The value obtained is contrasted with the traditional weighting approach to calculate the portfolio’s value. The process followed is the scientific method, starting with observation and hypothesis and after analyzing two examples, a synthesis is performed by generalizing the concepts and the main thesis that the Pythagorean approach here proposed constitutes an upper limit for the portfolio’s value.
This study uses a new estimation methodology to calculate the upper limit value of a portfolio of assets without the need to incorporate the weight of each asset. If there are no weights assigned to each asset, this upper limit may be the only way to calculate the portfolio’s value.
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