January 2014
Intermediate to advanced
752 pages
29h 9m
English
book
Modern Portfolio Theory and Investment Analysis, 9th Edition
by Edwin J. Elton, Martin J. Gruber, Stephen J. Brown, William N. Goetzmann
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5
Delineating Efficient Portfolios
In Chapter 4 we examined the return and risk characteristics of individual securities and began to study the attributes of combinations or portfolios of securities. In this chapter we look at the risk and return characteristics of combinations of securities in more detail. We start off with a reexamination of the attributes of combinations of two risky assets. In doing so, we emphasize a geometric interpretation of asset combinations. It is a short step from the analysis of the combination of two or more risky assets to the analysis of combinations of all possible risky assets. After making this step, we can delineate that subset of portfolios that will be preferred by all investors who exhibit risk avoidance and who prefer more return to less.1 This set is usually called the efficient set or efficient frontier. Its shape will differ according to the assumptions that are made with respect to the ability of the investor to sell securities short as well as her ability to lend and borrow funds.2 Alternative assumptions about short sales and lending and borrowing are examined.
COMBINATIONS OF TWO RISKY ASSETS REVISITED: SHORT SALES NOT ALLOWED
In Chapter 4 we began the analysis of combinations of risky assets. In this chapter we continue it. Previously, we treated the two assets as if they were individual assets, but nothing in the analysis so constrains them. In fact, when we talk about assets, we could equally well be talking about portfolios of ...
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O’Reilly covers everything we've got, with content to help us build a world-class technology community, upgrade the capabilities and competencies of our teams, and improve overall team performance as well as their engagement.Julian F.
I wanted to learn C and C++, but it didn't click for me until I picked up an O'Reilly book. When I went on the O’Reilly platform, I was astonished to find all the books there, plus live events and sandboxes so you could play around with the technology.Addison B.
I’ve been on the O’Reilly platform for more than eight years. I use a couple of learning platforms, but I'm on O'Reilly more than anybody else. When you're there, you start learning. I'm never disappointed.Amir M.
I'm always learning. So when I got on to O'Reilly, I was like a kid in a candy store. There are playlists. There are answers. There's on-demand training. It's worth its weight in gold, in terms of what it allows me to do.