Treynor Black Model - Calculating the weights in optimal portfolio towards, noticed, question, material

IAmNeil

Hi there,
I noticed that calculating the exact weight of Active Portfolio A in the Optimal Portfolio P is not addressed in Schweser material.
Will this calculation be a likely question or is it safe to ignore the exact calculation.
I am leaning towards just understanding the nuances of the concept?
Your opinions are much appreciated.

Best of luck to you all in your forthcoming exams.

chaojimali

Thanks for all your responses.
Spanishesk - I did not mean the weights of individual assets within the Active Portfolio A. I was referring to the weights of A and Market Portfolio M in the Optimal Portfolio P.

Best of luck to you all in your forthcoming exams.

RepoToronto

Not required

CPATrader

I am pretty sure it is no longer required to use it - just to understand the topic. See the actual LOS for the item.

yalo

do you mean the (alpha/Std error)/sum(alpha/std errors) equation? thats for allocation in the active protfolio. As far as allocation between active and market and RFR i have to go back and check.