Harry Markowitz, who went on to win the Nobel Prize in Economics in 1990, introduced modern portfolio theory, which forever changed the way people invest. His research illustrated that the most desirable investments strike an optimal balance between maximizing rewards and minimizing risks, a balance he called the “efficient frontier.” Markowitz showed that to achieve that balance, you shouldn’t concentrate your investments in a few stocks you hope will be in favor but rather diversify across all types of stocks.