The opportunity set of portfolios is:
A) all possible return combinations of those securities.
B) all possible risk combinations of those securities.
C) all possible risk-return combinations of those securities.
D) the best or highest risk-return combination.
E) the lowest risk-return combination.

Question

Quizplus · Accepted Answer

The opportunity set of portfolios represents all possible risk-return combinations of a set of securities. It allows investors to look at the trade-off between risk and return and choose the optimal portfolio suitable for their investment goals and risk tolerance. Therefore, option C is a correct choice. Options A, B, D, and E are not accurate as they only represent a specific aspect of the opportunity set and do not reflect the full range of possible portfolios.

The Opportunity Set of Portfolios Is