Finance and Financial Management Commons^™

Getting More Out Of Two Asset Portfolios, Tom Arnold, Terry D. Nixon

Finance Faculty Publications

Two-asset portfolio mathematics is a fixture in many introductory finance and investment courses. However, the actual development of the efficient frontier and capital market line are generally left to a heuristic discussion with diagrams. In this article, the mathematics for calculating these attributes of two-asset portfolios are introduced in a framework intended for the undergraduate classroom.