The computational difficulty of the Markowitz model is eased by the
A) single index model.
B) capital asset pricing model.
C) use of a single return benchmark.
D) all of the above.

Question

Quizplus · Accepted Answer

The computational difficulty of the Markowitz model is eased by the single index model, the capital asset pricing model, and the use of a single return benchmark. Each of these approaches simplifies the complex calculations involved in the Markowitz model by reducing the number of inputs required for portfolio optimization, such as the covariance between each pair of assets.

The Computational Difficulty of the Markowitz Model Is Eased by the