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Portfolio and characteristic line

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Which one is right and why? (explain in one sentence)

A portfolio is:
a). a group of assets, such as stocks and bonds, held as a collective unit by an investor.
b). the expected return on a risky asset.
c). the expected return on a collection of risky assets.
d). the variance of returns for a risky asset.
e). the standard deviation of returns for a collection of risky assets.

5. The characteristic line is graphically depicted as:
a). the plot of the relationship between beta and expected return.
b). the plot of the returns of the security against the beta.
c). the plot of the security returns against the market index returns.
d). the plot of the beta against the market index returns.
e). None of the above.

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  • MBA, Indian Institute of Finance
  • Bsc, Madras University
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