Portfolio Risk and Return – Part II (2025 Level I CFA® Exam – PM – Module 2)

Prep Packages for the CFA® Program offered by AnalystPrep (study notes, video lessons, question bank, mock exams, and much more): Level I: https://analystprep.com/shop/cfa-level-1-learn-practice-package/ Level II: https://analystprep.com/shop/learn-practice-package-for-level-ii-of-the-cfa-exam-by-analystprep/ Levels I, II & III (Lifetime access): https://analystprep.com/shop/cfa-unlimited-package-for-level-1-2-3/ Prep Packages for the FRM® Program: FRM Part I & Part II (Lifetime access): https://analystprep.com/shop/unlimited-package-for-frm-part-i-part-ii/ Topic 9 – Portfolio Management Module 2 – Portfolio Risk and Return – Part II 0:00 Introduction and Learning Outcome Statements 4:45 LOS : Describe the implications of combining a risk-free asset with a portfolio of risky assets. 6:49 LOS : Explain the capital allocation line (CAL) and the capital market line (CML). 12:08 LOS : Explain systematic and nonsystematic risk, including why an investor should not expect to receive additional return for bearing nonsystematic risk. 16:00 LOS : Explain return generating models (including the market model) and their uses. 24:32 LOS : Calculate and interpret beta. 29:31 LOS : Explain the capital asset pricing model (CAPM), including its assumptions, and the security market line (SML). 39:43 LOS : Calculate and interpret the expected return of an asset using the CAPM. 41:04 LOS : Describe and demonstrate applications of the CAPM and the SML. 48:18 LOS : Calculate and interpret the Sharpe ratio, Treynor ratio, M2, and Jensen’s alpha.