Analysis of Efficient Portfolio Formation in Stock Selection Case Study of a Food and Beverage Company Listed on the Indonesian Stock Exchange

Abstract

The mission of this study is to assess the effectiveness of the portfolio development process in selecting shares listed on the Indonesia Stock Exchange (BEI), the focus is on the food and beverage company sector.The object of this research is the moon January-December 2022. The sample used was 5 companies with 10 portfolio combinations. In an era of economic uncertainty and market fluctuations, it is important for investors to understand how to build efficient portfolios to achieve their financial goals. This case focuses on the food and beverage industry because this sector is often used as an attractive investment option by a number of investors.This research involves assessing historical data regarding the share value of companies in the food and beverage industry sector and listed on the IDX.This historical dataused to evaluate the performance of these stocks, identify elements that influence changes in stock prices, and design optimal portfolio models.This research also involves risk and return investment analysis in forming a balanced portfolio. In this research, two optimal portfolios were identified, both with equal fund allocations and different fund allocations.This research provides valuable insight into how investors canchoose shares that suit their investment goals.These findings can help investors to mitigate risks and increase the potential returns on their investments. This research has significant practical implications for investors, especially those interested in the food and beverage sector on the Indonesia Stock Exchange.With a deep understanding of efficient portfolio formation, Investors can make smarter investment decisions and more effectively manage their risks. In this way, the research makes a significant contributionin developing better investment strategies in the Indonesian stock market.