This document discusses portfolio theory and types. It begins by explaining modern portfolio theory, which was pioneered by Harry Markowitz in 1952 and aims to maximize returns for a given level of risk through diversification. It then describes the two main types of portfolio theory: modern portfolio theory and post-modern portfolio theory. Modern portfolio theory uses mean-variance to evaluate risk while post-modern portfolio theory uses downside risk instead. Both theories aim for portfolio optimization but differ in their definition and evaluation of risk.