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Which of the following statements is correct, according to portfolio theory? An investors risk aversion level should determine the capital allocation to the risky portfolio.

Which of the following statements is correct, according to portfolio theory?

		An investors risk aversion level should determine the capital allocation to the risky portfolio.
		The optimal risky portfolio is one with the highest expected return.
		All investors will invest in the same optimal complete portfolio.
		An investors risk aversion level should determine the optimal risky portfolio.

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