# Question: What is the optimum portfolio assuming short sales but no

What is the optimum portfolio assuming short sales but no riskless lending and borrowing with p = 0.5 for all pairs of securities? Use the data in Problem 4.

In Problem 4

In Problem 4

## Relevant Questions

Consider the following three investments. Which are preferred if U(W) = W -(1/2)W2? In Problem 5, what is the minimum amount that the $5 outcome would have to be changed to so that the investor is indifferent between the two investments? In Problem 5 Assume that you expect that the average return on a security in various markets is as shown in the following table. Assume further that the historical correlation coefficients shown in Table 12.1 are a reasonable estimate of ...Assume that over some period, a CAPM was estimated. The results are shown below. Assume that over the same period, two mutual funds had the following results: What can be said about the fund performance? Given the model shown below, what is the risk-free rate if the post tax equilibrium model describes returns?Post your question