Both the Efficient Frontier and Beta Are Important Aspects of MPT

question 9

True/False

Both the efficient frontier and beta are important aspects of MPT.

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Definitions:

Risk-free Return

The theoretical return on investment with no risk of financial loss, often represented by the yield on risk-free government bonds.

Standard Deviation

A measure of the dispersion or variability of a set of data points from their mean, used in finance to indicate the volatility of an investment.

Defined Contribution Plan

A retirement plan where an employee, employer, or both make contributions on a regular basis, but the final benefit received depends on the plan's investment performance.

Risk-free Return

The theoretical return on an investment with zero risk of financial loss, typically associated with government bonds.