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Behaviorally modified portfolio

Any ideas on what appears to be a conflict in the text:
Schwser Book 1 Page 189: “Behaviorally moddifying a portfolio simply means constructing it according to the investor’s behavioral risk and return preferences.  The strategy portfolio is probably not efficient from a modern portfolio theory perspective, but the investor is comfortable with it and will, thus, be more likely to adhere to the strategy.”
Schweser Book 1 Page 199: “By incorporating behavioral biases into clients’ IPSs, clients’ portfolios will tend to be closer to the efficient frontier, and clients will be more trusting and satisfied and tend to stay on track with their long term strategic plans.”

it is closer to efficient frontier in terms of risk / return characteristics…
even without considering the correlations.
Efficient frontier is just a plot of return vs. risk, isn’t it?
it could have been more efficient in terms of considering the correlations, (become more efficient in that sense) - but that would have thrown the asset class weights out of whack - and the client would not then appreciate what is being done.
So essentially a tradeoff.

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上一主题:2010 AM Exam, #1E. Question. Please help!
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