Question

A portfolio is efficient if which of the following is true?

Answer 1

Answer:

In economics, a portfolio is a term for a specific set of stocks, bonds, shares, and other securities owned by an investor. In general, the investor seeks to compile and diversify a portfolio of securities that offers maximum profitability and at the same time is diverse, in order to minimize possible risks. In general, these types of portfolios are considered efficient, as they do not leave the investment risk tied to a single factor. However, these two goals often go against each other, so the composition of the portfolio means a certain compromise.