Efficient frontier
Investment portfolio which occupies the "efficient" parts of the risk-return spectrum / From Wikipedia, the free encyclopedia
This article is about a financial mathematical concept. For other frontiers described as efficient, see Production possibilities frontier and Pareto frontier.
In modern portfolio theory, the efficient frontier (or portfolio frontier) is an investment portfolio which occupies the "efficient" parts of the risk–return spectrum. Formally, it is the set of portfolios which satisfy the condition that no other portfolio exists with a higher expected return but with the same standard deviation of return (i.e., the risk).[1] The efficient frontier was first formulated by Harry Markowitz in 1952;[2] see Markowitz model.
![Thumb image](http://upload.wikimedia.org/wikipedia/commons/e/e1/Markowitz_frontier.jpg)