The bottom half of the mean-variance frontier is efficient.

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Diversification removes idiosyncratic risk but does not influence the overall risk of the portfolio.

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The capital allocation line that goes through the risk-free asset and the market portfolio is called the capital market line.

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The mean-variance frontier for two assets consists simply of all possible portfolio combinations of the two.

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Covariance with the rest of the portfolio determines how much risk it contributes to the portfolio.

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Optimal portfolios are all the portfolios that lie on the minimum-variance frontier from the minimum-variance portfolio and upwards.

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The greater an asset's covariance with other assets in the portfolio, the more it contributes to portfolio variance.

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Oil prices rise is an example of sources of market risk

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