Efficient frontier identified, following, efficient, possible, investor

aurific

An investor has identified the following possible portfolios. Which portfolio lies to the right of the efficient frontier?

Portfolio Expected Return Standard Deviation
A 18% 35%
B 12% 16%
C 10% 10%
D 14% 20%
E 13% 24%

A) D.

B) E.

C) A.

Jolyn

B) E

B has 12% Return for 16% Risk.
E has 13% return for 24% Risk.
Whereas
D has 14% return for 20% Risk.

E has higher Risk (24%) than D (20%), but still its Returns are lower than D.

Also, visualize Risk being plotted on X axis and Returns on Y axis.

Edit: To make it easier, sort them all in order of their increasing Returns. And then see if their corresponding Risks are coming to be in that increasing order. If not, then then one which is causing it should be the culprit.



Edited 1 time(s). Last edit at Thursday, December 3, 2009 at 03:00AM by rus1bus.

Siddimaula

Damn! its RIGHT to the efficient frontier!!
i did not read the question properly!!

Thanks rus1bus!