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Suppose there are only two risky assets. Solve for the portfolio that has the minimum variance

Suppose there are only two risky assets. Solve for the portfolio that has the minimum variance

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Answer #1

A risky asset refers to the asset which has substantial amount of risk involved. Such assets are mainly high interest yielding bonds. Portfolio refers to a set of investments held by a person to distribute the total risk of each asset. And variance here refers to the difference between the average or mean figures and the actual figures. In the above question it is already given the we have to assume that there are only two risky assets.

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