Stochastic Dominance, Mutual Funds Separation and Portfolio Frontier
In Chapter 2 we have shown that portfolio problems can be very complex. In general, no explicit formula for the optimal portfolio exists. In this chapter we present some instruments useful to address the portfolio problem. The goal is to provide conditions on the probability distribution of asset returns so that the choice problem is simplified.
KeywordsUtility Function Mutual Fund Expected Return Risky Asset Stochastic Dominance
Unable to display preview. Download preview PDF.