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Last week someone asked about optimal asset allocation among three
assets:
10% return guaranteed
50% return subject to 50% loss
100% return subject to 100% loss
Well an economist named Markowitz won a Nobel prize for answering just
that question. He calls it Mean-Variance Analysis. There isn't enough
information to answer the question you asked. You also need to know the
correlation between the risky assets (the 50% and the 100%)
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