Microsoft Word 2007 ichrie conference Proceedings Final-Final 06-06-07. doc

 
2007 Annual International CHRIE Conference & Exposition 
143
FINANCIAL PORTFOLIO APPROACH TO OPTIMAL TOURIST MARKET MIXES: AN 
APPLICATION TO TAIWAN 
SooCheong (Shawn) Jang 
Purdue University 
and 
Ming-Hsiang Chen 
National Chung Cheng University 
 
ABSTRACT 
This study applied a financial portfolio theory to estimate optimal market mixes to minimize the instability of 
the inbound tourist market demand. An empirical analysis was applied to inbound tourists to Taiwan. The results 
based on the portfolio analysis can shed light on the issue of diversification in the tourism markets and offer the 
tourism authorities and policy-makers explicit guidelines for risk management in the destination planning process. 
Consequently, the use of the optimal mixes with various return/risk options can facilitate a more stable pattern of 
arrivals from foreign countries.
Key Words
: Financial portfolio theory; optimal market mix, inbound tourists; Taiwan.