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Capital Allocation Line - CAL

What Does Capital Allocation Line - CAL Mean?
A line created in a graph of all possible combinations of risky and risk-free assets. Also known as the "reward-to-variability ratio".

Investopedia explains Capital Allocation Line - CAL
The graph displays to investors the return they can make by taking on a certain level of risk.

Related Terms

Capital Accumulation
Efficient Frontier
Expected Return
Modern Portfolio Theory - MPT
Portfolio
Risk
Risk/Return Tradeoff
More Related Terms

Related Links

Achieving Optimal Asset Allocation - Minimizing risk while maximizing return is any investor's prime goal, and the right mix of securities is the key.
4 Steps To Building A Profitable Portfolio - This is a step-by-step approach to determining, achieving and maintaining optimal asset allocation.

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