Portfolio Risk and Return: Part II
Free CFA Level I lesson in Portfolio Management. 16 min read, ~2,445 words.
CAPM: E(Ri) = Rf + βi × (E(Rm) − Rf). Beta is the only priced risk. Nonsystematic risk earns zero premium because diversification eliminates it for free. CML uses total risk (σ) and applies only to efficient portfolios. SML uses beta and applies to any asset. Sharpe and M² use...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
- portfolio risk and return part I
- portfolio risk and return part II
- portfolio management overview
- portfolio planning and construction
- behavioral biases of individuals
- introduction to risk management
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