RISK MINIMIZATION ON THE RETURN OF A PORTFOLIO OF TWO AGRICULTURAL OR FORESTRY ACTIVITIES

Abstract

This paper examines the case of a risk-averse producer who wants to invest in two different simultaneous agricultural or forestry activities and in a risk-free security, by forming a portfolio that minimizes his risk. Putting together this portfolio is a way of self-insurance, allowing the producer a reduction in the risk inherent in his business activities.