This is an very informative set of videos. No one video will answer all our questions, but this a good set of building blocks to help us understand the efficient frontier.
- Video 1 is very qualitative and gives us some history and context.
- Video 2 show us some of the math.
- Video 3 is by Mr. Bhatnager and gives us a great example of how covariance and correlation are calculated from two sample assets.
- Video 4, again by Mr. Bhatnager, is a fantastic MS-Excel example of two assets with given expected values, variances, portfolio returns as a function of wieghts, and covariance. It does not calculate variance, covariance, etc. Instead, it begins after those have been figured out.
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1. Theory of the Efficient Frontier (3:59) |
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2. Covariance & Correlation (9:54) |
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3. Covariance & Correlation between Assets (6:45) |
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4. Concavity of the Efficient Frontier (10:31) |
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