Portfolio Management【Reading 43】Sample should, investor, framework, 2012

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In the Markowitz framework, an investor should most appropriately evaluate a potential investment based on its:

A) intrinsic value compared to market value.

B) effect on portfolio risk and return.

C) expected return.

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Modern portfolio theory concludes that an investor should evaluate potential investments from a portfolio perspective and consider how the investment will affect the risk and return characteristics of an investor’s portfolio as a whole.