Dictionary of Business Terms: efficient portfolio
efficient portfolio
portfolio of investments that has a maximum expected return for a given level of risk or a minimum level of risk for a given expected return.
Dictionary of Finance and Investment Terms: efficient portfolio
efficient portfolio
portfolio that has a maximum expected returnfor any level of risk or a minimum level of risk for any expected return. It is arrived at mathematically, taking into account the expected return and standard deviation of returns for each security, as well as the covariance of returns between different securities in the portfolio.
