Real Estate Portfolio Optimization And Risk Measurement Model

Real estate is a capital-intensive industry, real estate investors need to not only open up new financing channels and means of financing, they also require the establishment of an effective operational mechanism and the real estate investment idea. Along with the constant development of real estate industry in China, there are many real estate investment both in geographical portfolio and varieties portfolio. How to maximize the return on investment and minimize the risk of real estate investment portfolio is the main objective of the investors.However, there are many theoretical or empirical studies on the investment portfolio concentrated mainly in the area of the securities market and few areas of real estate investment portfolio in China, it is difficult to meet real estate investors' needs to decentralize the investment risks and increase the investment income. In the real estate investment portfolio management, in the face of a wide range of real estate investment options, the choice of what kind of investment products, how to weigh the benefits and the risk of different products to determine the optimal investment portfolio, while when different real estate products in the risk-benefit changes, how to appropriately adjust the holder's asset portfolio and avoid risks to the greatest extent the stability of income are the key aspects.In this paper, the real estate investment portfolio optimization and risk measurement and control are carried out in-depth studies. Based on the mature modern portfolio theory and successful real estate investment experiences in the western countries, we establishe a portfolio optimization model which maximize the investment revenue of each unit's real estate investment risk. In addition, we analyse the major risk factors of real estate investments. At the empirical studies, this model will be used to help to make the investment funds distribution decision on three typises real estate products of mid-to-high grade house, office and large and medium-sized shopping centers of Gemdale Corporation which plan to invest 3 billion RMB in Shenzhen and Guangzhou cities in near future.Through theoretical analysis and market survey, we establishe the real estate investment risk evaluation system and get the current relative degree of risk of the three different varieties mentioned above. After that, when we combine it with the history yield data of similary varieties happened in the Shenzhen and Guangzhou, the decision is made by the optimization model. At last, this paper also tells the optimizational portfolio risk measurement throug VaR model. The results shows that the portfolio optimization model made in this dissertation can provide a good basis for decision support.