What are basic assumptions behind markowitz portfolio theory

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Reference no: EM13924508

• What do we mean by risk aversion, and what evidence indicates that investors are generally risk averse?

• What are the basic assumptions behind the Markowitz portfolio theory?

• What do we mean by risk, and what are some measures of risk used in investments?

• How do we compute the expected rate of return for a portfolio of assets?

• How do we compute the standard deviation of rates of return for an individual risky asset?

• What do we mean by the covariance between rates of return, and how is it computed?

Reference no: EM13924508

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