Investment Decisions According to the Miller and Markowitz Models. A Look at Smart Cash Management

González-Díaz R.R.; Becerra-Pérez L.A.; Guanilo S.L.; Ovalles-Toledo L.V.; Cruz-Ayala K. · Smart Innovation, Systems and Technologies (2022) · DOI: 10.1007/978-981-16-5063-5_22

Resumen

Investment decisions in corporate finance are decisive for improving the cyclical fluctuation of any form of business, minimising opportunity costs and maximising returns on idle funds. Empirical evidence has shown that the agricultural sector has only two financial periods in the year: surplus and deficit. If good decisions are not made in some of these periods, serious financial problems could arise. Therefore, this study presents an analysis of the cash management of microenterprises in the livestock sector in the Colombian Caribbean region, based on the cash flow management models proposed by Miller and Orr, who consider the volatility of cash balances and the trends of projects at the upper and lower limits of optimal cash balances. This indicates to financial management when to purchase a type of financial instrument. In stable economic conditions, the cases of acquiring financial assets, the optimal investment portfolio is determined in relation to the profitability and risk of the 3 stocks with the largest share in the COLCAP index: ECOPETROL, PFBCOLOM and GRUPOSURA, based on the Markowitz model.

Instituciones: Universidad Nacional Jorge Basadre Grohmann