In the solvingprocessof the allocationproblem with the Hungarianmethod, it is necessary todeterminethemaximumallocationofzeroelements of the transformedcoefficientmatrix.
For any portfolio that includes an allocation to gold, there is a better portfolio, one with a higher expected return or a lower volatility that has a zeroallocation to gold.
"It's a common assumption that the average individual investor has zeroallocation to commodities, " says Matthew Carvalho, director of investment research at Loring Ward, a financial-advisory firm in San Jose, Calif.