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Why is the portfolio weight of the risk-free asset capped at 1?

Weights can't exceed 100%, so you know that $0 \le \alpha \le 1$. If $\alpha =1$, it means that 100% of the assets in the portfolio are risk-free assets. If $\alpha \neq 1$, it mean that a share $\...
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Why aren't stock bubble crashes just zero sum exchanges of wealth?

The transactions on the exchange are zero sum. But when people say that some event wiped out 1 trillion in market value", they're referring to market cap. The problem here is that people use past ...
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