Getting More Out of Two Asset Portfolios
21 Pages Posted: 19 Jun 2006
Date Written: September 1, 2005
Two asset portfolio mathematics is a fixture in many introductory finance and investment courses. However, the actual development of the efficient frontier and capital market line are generally left to a heuristic discussion with diagrams. In this paper, the mathematics for calculating these attributes of two asset portfolios are introduced in a framework intended for the undergraduate classroom.
Keywords: pedogogy, minimum variance portfolio, efficient frontier, capital allocation line
JEL Classification: G10,G11
Suggested Citation: Suggested Citation