Efficient frontier: Difference between revisions
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''Portfolio analysis''. | ''Portfolio analysis''. | ||
The efficient frontier represents portfolios which dominate all other possible portfolios by giving the maximum possible expected return, for the given variance of returns. | The efficient frontier represents portfolios which dominate all other possible portfolios by giving the maximum possible expected return, for the given variance of returns. | ||
Therefore rational investors will always invest only in portfolios which lie on the efficient frontier. | Therefore rational investors will always invest only in portfolios which lie on the efficient frontier. | ||
== See also == | == See also == | ||
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* [[Feasible set]] | * [[Feasible set]] | ||
* [[Inefficient portfolio]] | * [[Inefficient portfolio]] | ||
[[Category:Investment]] | |||
Latest revision as of 13:41, 30 June 2022
Portfolio analysis.
The efficient frontier represents portfolios which dominate all other possible portfolios by giving the maximum possible expected return, for the given variance of returns.
Therefore rational investors will always invest only in portfolios which lie on the efficient frontier.
