The portfolio optimization process consists of selecting the best asset allocation or combination of assets that best suit investor needs. To determine the optimal portfolio, investors usually have two options: heuristics and quantitative models. Heuristics are not based on theoretical models or require sophisticated mathematical knowledge like the \(1/N\) portfolio that assigns the same weight to all assets or the \(60/40\) portfolio that invests \(60\%\) in equities and \(40\%\) in bonds. The main disadvantage of heuristics is that they do not produce an optimal asset allocation that suits investor needs. On the other hand, quantitative models require a more advanced mathematical knowledge, but they can be customized in order to suit investor needs.