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Example: At current prices, the tangency portfolio has 20% stock A, 45% stock B, and 35% stock C, while the market portfolio has 15% stock
Example: At current prices, the tangency portfolio has 20% stock A, 45% stock B, and 35% stock C, while the market portfolio has 15% stock A, 45% stock B, and 40% stock C What is the problem with demand for stock A? for stock C? What will happen to the price of stock A? To its return? Harder question: in equilibrium, what will be the composition of T and M
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