Markowitz Portfolio Theory, developed by Harry Markowitz in the 1950s, is a framework for constructing an investment portfolio that aims to maximize returns while minimizing risk. The theory emphasizes the importance of diversification, suggesting that investors can reduce the overall risk of their portfolio by combining different assets that do not move in perfect correlation with each other. The key concept of the theory is the efficient frontier, which represents the optimal portfolios that offer the highest expected return for a given level of risk. By analyzing the risk-return profiles of various assets, investors can make informed decisions to achieve their financial goals while managing potential losses.