A Comparative Study of the Effectiveness of Markowitz and Index Models in the Context of U.S. Tariff Increases

In today's challenging and opportunistic world environment, choosing a more effective model to analyze portfolios in the context of unexpected events is increasingly important. In this paper, we will examine the different effects of using the Markowitz model (MM) and the Index Model (IM) in the context of the U.S. tariff adjustment policy and compare which model is more suitable for studying the optimal portfolios in the context of unforeseen events such as the U.S. tariff adjustment policy. The methods used in this paper are the MM and the IM to analyze the real data of stocks and compare the return, standard deviation, and Sharpe ratio of each stock with the calculations generated by Excel using the U.S. tariff policy adjustment as an example. The study results show that the Index model has better results as it has higher returns and Sharpe ratios in contingency situations. Therefore, the full Index model for investment in contingency situations is recommended.