The implementation of the IHSI model requires the use of information about the expected long-term return on stocks.
The IHSI model will be presented in the fourth section.
It should be stated here that inflation is incorporated in the IHSI Model, but in an indirect way.
The calculated values of [R.sub.j] will then be used in the IHSI model, to be discussed in the next section, to formulate the optimal portfolio.
The IHSI Model, on the other hand, allows the decision maker to change the portfolio mixture frequently during a specified time span without having to abandon the original long-term investment objective.