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In Portfolio Theory, What Is the Definition of an "Optimal

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Essay

In portfolio theory, what is the definition of an "optimal" portfolio of risky assets if we assume that no such thing as a riskless asset exists? That is, what are the characteristics that define, or the criteria that determine, such a portfolio?) Now answer this same question under the assumption that there does exist a riskless asset and state how you could identify the optimal portfolio. Be complete, defining any specialized terms you employ.


Definitions:

Trade Secrets

Confidential business information that provides an enterprise a competitive edge and is often not disclosed to the public.

Misappropriations

involves the wrongful, illegal, or unauthorized use of funds or assets for purposes other than those intended by the owner or rightful possessor.

World Trade Organization

An international organization that deals with the rules of trade between nations, aiming to ensure that trade flows as smoothly, predictably, and freely as possible.

Basic Purpose

The fundamental reason or objective for the existence of an entity, policy, or action.

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