If the expected return of the market portfolio (M) is 6.5% and its standard deviation is 10% and the risk-free rate of return is 2.5%, what would the expected return of the investor's portfolio if he is only willing to take a risk of 5%?

 

Is this investor considered a conservative or an aggressive investor and why? 

 

Draw the CML explaining where on the line could this investor be?

Answer rating: 100% (QA)

To calculate the expected return of the investors portfolio we can use the Capital Market Line CML e... View the full answer