Section A (1 Mark)A zero-investment portfolio with a positive expected return arises when ________

AAFM CWM_LEVEL_2 Question Answer

Section A (1 Mark)

A zero-investment portfolio with a positive expected return arises when _________.

An investor has downside risk only

The law of prices is not violated

The opportunity set is not tangent to the capital allocation line

A risk-free arbitrage opportunity exists

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Section A (1 Mark)A zero-investment portfolio with a positive expected return arises when _________.