6. Investor equilibrium The following graph shows the set of portfolio opportunities for a multiasset case. The point nee corresponds to a risk-free asset, the red curve BME is the efficient frontier, the shaded area under the efficient frontier represents the feasible set of portfolios of risky assets, and the yellow curves Iz and 12 are indifference curves for a particular investor EXPECTED RATE OF RETURN (Percent 10 w /- 10 RISK Portfalio's stanidard deviationl Assuming that the capital market is in equilibrium, point M. where the ine nMZ is tangent to the curve BME, represents O A portfolio that provides the smatiest degree of risk for a given expected return O A portfollo that provides the highest possible return for a given amount of risk O A portfolio that is dominated by portfo o O The market vatue-weighted portfolto of all nisky assets in the economy