For a given standard deviation, an efficient portfolio will
A) minimize the portfolio beta.
B) minimize the number of securities held in the portfolio.
C) maximize the expected return.
D) pinpoint the single best risk-return tradeoff point.

Question

Quizplus · Accepted Answer

An efficient portfolio aims to maximize the expected return for a given level of risk (standard deviation), rather than minimizing beta, minimizing the number of securities, or pinpointing a single risk-return tradeoff point.

For a Given Standard Deviation, an Efficient Portfolio Will