# On Optimal Portfolios of Dynamic Resource Allocations

## TL;DR

This paper develops a general framework for optimally allocating resources dynamically among multiple entities over time, balancing expected returns and risk within a finite planning horizon.

## Contribution

It introduces a novel solution framework for deriving optimal dynamic resource allocations considering stochastic returns and risk management.

## Key findings

- Framework effectively balances return and risk in resource allocation.
- Method applicable to various resource allocation scenarios.
- Provides a systematic approach to optimize over finite horizons.

## Abstract

We consider the optimal allocation of generic resources among multiple generic entities of interest over a finite planning horizon, where each entity generates stochastic returns as a function of its resource allocation during each period. The main objective is to maximize the expected return while at the same time managing risk to an acceptable level for each period. We devise a general solution framework and establish how to obtain the optimal dynamic resource allocation.