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In this module we learned to examine the construction and properties associated with the optimal risky portfolio, illustrate how the Treynor-Black and the Black-Litterman models complement one another in the portfolio optimization process, examine the systematic 4-stage investment process suggested by the CFA Institute, and analyze the influence of taxes on investment strategies.

Question:

Lets extend the discussion by examining the practical implications of these concepts. Under what circumstances would it make sense to use the Treynor measure to compare the performance of a given set of portfolios?

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