What happens to portfolios that cannot be dominated?
A)They lie on the efficient frontier.
B)They are minimum risk portfolios.
C)They have low correlations.
D)They have maximum expected returns.

Question

Quizplus · Accepted Answer

Portfolios that cannot be dominated by any other portfolio lie on the efficient frontier, which is the set of portfolios with the highest expected return for any given level of risk. In other words, these portfolios offer the best risk-return tradeoff and are considered optimal.

What Happens to Portfolios That Cannot Be Dominated