annual returns, beta, Capital Asset Pricing Model, CAPM, diversification, dollar profits, four classes of assets, historical returns and risk, holding period returns, investment rules, minimizing risk, normal distributions, percentage returns, potential outcomes, probabilities, Security Market Line, SML, systematic and unsystematic risk, trade-off

arithmetic average returns versus geometric returns, calculation of portfolio statistics, CAPM, diversification, geometric mean, holding period returns, securities market line, sharps ratio, two asset portfolio, varying weights