A portfolio is efficient if no other asset or portfolios offer higher expected return with the same (or lower) risk or lower risk with the same (or higher) expected return.

Question

Quizplus · Accepted Answer

An efficient portfolio is one that offers the highest expected return for a given level of risk or the lowest risk for a given level of expected return, meaning that no other asset or portfolio offers a better risk-return tradeoff.

A Portfolio Is Efficient If No Other Asset or Portfolios