Question: What are the problems of using unconstrained mean-variance optimization in practice? Explain the optimizer's mirage. 2. Discuss the Black-Litterman model and the problem it is

What are the problems of using unconstrained mean-variance optimization in practice? Explain the optimizer's mirage. 2. Discuss the Black-Litterman model and the problem it is trying to solve. 3. Explain how to test the CAPM using time-series and cross-sectional tests. 4. Discuss the evidence for the following predictions of the CAPM: i) expected returns are increasing in market betas; ii) the slope of the SML is given by the market risk premium 5. Does the data support the prediction that a single factor, market beta, explains the cross-section of returns? Discuss the evidence relevant to this

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