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115 CFA
File:
115.100.01.01 Portfolio Management - Reading 51 - 1. A Portfolio Perspective on Investing
1. A Portfolio Perspective on Investing
a. describe the portfolio approach to investing;
What is the purpose of portfolio theory of investing?
Portfolio theory is used to maximize an investment's expected rate of return for a given level of risk or minimize the level of risk for a given expected rate of return.
What is diversification ratio?
The diversification ratio is the ratio of the standard deviation of an equally weighted portfolio to the standard deviation of a randomly selected security.
Source:
- CFA
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- 115.100.01 Portfolio Management - Reading 51 - Portfolio Management An Overview >> 115.100.01.01 Portfolio Management - Reading 51 - 1. A Portfolio Perspective on Investing