The efficient frontier in a profile model is the set of options that offers a maximum return for a given level of risk or a minimum risk for every level of return.

Question

Quizplus · Accepted Answer

This statement is true. The efficient frontier is a graph that represents the optimal portfolio of investments that offers the best possible combination of return and risk. The points on the efficient frontier represent portfolios that offer either the highest possible return for a given level of risk, or the lowest possible risk for a given level of return. The goal of portfolio management is to construct a portfolio that lies on the efficient frontier, based on the investor's risk/return preferences.

The Efficient Frontier in a Profile Model Is the Set