why portfolio manager should construct the portfolio on EFL(effecient frontier line)
Efficient frontier line represent the combination of assets providing highest return for given variance or risk and for a given return what is the minimum risk portfolio. It is based on the assumption that it follows normal distribution. It helps managers to get maximum return for a given risk or help to find the lowest risk for a given return.
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why portfolio manager should construct the portfolio on EFL(effecient frontier line)