Question: Consider this plot, where each blue point is a possible portfolio of stocks. A portfolio has a 3% expected return with 0.6% standard deviation of

 Consider this plot, where each blue point is a possible portfolio

Consider this plot, where each blue point is a possible portfolio of stocks. A portfolio has a 3% expected return with 0.6% standard deviation of returns. Therefore the portfolio is: Dominated, as there is a portfolio on the efficient frontier that has higher return and lower risk. Dominated, as there is a portfolio on the efficient frontier that has higher risk and higher return. A potential portfolio that the investor may pick

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