minimum variance
[ˈmɪnɪməm ˈvɛriəns]
noun
variância mínima
1. In statistics and portfolio theory, the lowest possible variance or standard deviation achievable in a dataset or investment portfolio, often representing the least amount of risk or dispersion
The portfolio manager aimed to construct a minimum variance portfolio to reduce risk for investors.
O gestor de portfólio procurou construir um portfólio de variância mínima para reduzir o risco dos investidores.
2. A mathematical optimization concept where the goal is to find the minimum value of variance in a set of variables or outcomes
Using the minimum variance principle, the engineer designed the system with the least fluctuation possible.
Usando o princípio de variância mínima, o engenheiro projetou o sistema com a menor flutuação possível.
This is a specialized technical term primarily used in financial markets, investment management, and academic research in both Brazil and the USA. It gained prominence after Harry Markowitz's Modern Portfolio Theory (1952) and is fundamental to asset allocation strategies. The concept is more prevalent in institutional finance than in everyday Brazilian or American English usage.
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