Efficient Frontier: Optimal Asset Allocation

View PDF

The efficient frontier is a method of strategic asset allocation analysis that displays optimal allocations for your company; identifying the best possible (expected) return for different portfolio constructions (at your preferred fixed income-to-risk asset ratio).

The efficient frontier helps insurers and risk pools identify if they may be able to achieve a higher expected return with the same amount of volatility found in their current portfolio.

Similarly, companies can test to see if the portfolio could reduce volatility while maintaining its current expected return.


Continue to the Education Library >>