The goal of an efficient portfolio is to
A) maximize risk for a given level of return.
B) maximize risk in order to maximize profit.
C) minimize profit in order to minimize risk.
D) minimize risk for a given level of return.

Question

Quizplus · Accepted Answer

The goal of an efficient portfolio is to minimize risk for a given level of return. This means that an investor can achieve the highest possible return for a given level of risk or the lowest possible risk for a given level of return by choosing an efficient portfolio. The efficient portfolio is a combination of assets that offer the best risk and return profile.

The Goal of an Efficient Portfolio Is to