Finance
Build the portfolio with its risk
When assets each look good on their own, identify the efficient portfolio; use the risk-free asset and systematic risk pricing to build the mix that fits the target risk.
Your learning route
The program order
Complete the programs in order to finish the route. Each one brings short lessons, applied practice and a realistic business case together.
Plus and Pro members can create a verifiable Stratify certificate when the route is complete.
- Program 01
Identifying efficient portfolios
Intermediate: you tell apart the portfolios that offer a higher expected return at the same risk or a lower risk at the same return. By the end of this program you can use the efficient frontier's decision logic to screen out dominated portfolios.
- Spot the dominant portfolio
Apply it: Closing case: pick the efficient candidate
4 lessons · ≈3 hours
- Program 02
Build a portfolio with the risk-free asset
Intermediate: you compute the weights, expected return, and risk of a portfolio that combines a risk-free asset with a risky one, price each unit of risk with the Sharpe ratio, and read borrowing as a negative weight on the risk-free asset. By the end of this program you can set the risky weight that hits a return target, defend the risk budget it implies, and govern a levered position explicitly.
- Set the right weight
Apply it: Closing case: choose the risk budget
4 lessons · ≈3 hours
- Program 03
Pricing systematic risk
Advanced: combine beta, the equity market risk premium, and the risk-free rate in the CAPM equation. By the end of this program you can compute the required return for nondiversifiable risk and audit the inputs behind a discount rate.
- Which risk gets priced?
Apply it: Closing case: defend the discount rate
4 lessons · ≈3 hours