Why would every tradable asset in the market be included

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Question: CAPM can trace its development from the insight which shows that the process of optimizing the return/risk ratio will ensure that every investor will invest in a portfolio of risk free asset and the risky market portfolio (also known as the two find separation theorem). illustrate with a graph why no one will invest in other risky portfolios than the market portfolio. Why would every tradable asset in the market be included in this market portfolio?

Reference no: EM133332235

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