Search results with tag "1 fund theorems"

1 Fund theorems - Columbia University

For α 0 ≤ 1, |1−α 0| = 1−α 0 so the point can be re-written as (1−α 0)(γ,m)+α 0(0,r f). As α 0 varies from 1 down to 0, the point spans out the line connecting point (0,r f) to point (γ,m), corresponding to the two extremes of investing all in A 0 or all in the fund. The line is given by the equation r = (m−r f) γ

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