In the next question, we consider the risk parity portfolio, defined as the portfolio fully invested in risky assets for which all constituents have the same contribution to risk. If there are N constituents, the covariance between assets i and j is ij and the portfolio weights are stacked in the column vector w, the portfolio variance can be written as j2=ij=1Nwiwjij It can be rewritten as p2=i=1N[wij=1Nwjij] {c1=c2==cNw1+w2++wN=1 We also define the "inverse volatility portfolio" as the portfolio in which risky assets are weighted by the reciprocal of their volatility, that is wi=xi1,fori=1,N where x=j=1Nj1 and i is the volatility of asset i. Similarly, the "inverse variance portfolio" is the portfolio in which assets are weighted by the reciprocal of their Coincides with the equally weighted portfolio variance, that is wi=yi21,fori=1,N, Coincides with the inverse volatility portfolio where y=j=1Nj21. Coincides with the inverse variance portfolio Is not uniquely defined