Utility function
A utility function is a mathematical expression that assigns a value to all possible choices. In portfolio theory the utility function expresses the preferences of economic entities with respect to perceived risk and expected return. |
Similar financial terms
Utility valueThe welfare a given investor assigns to an investment with a particular return and risk.
Utility
The measure of the welfare or satisfaction of an investor or person.
Probability function
A function that assigns a probability to each and every possible outcome.
Probability density function
The probability function for a continuous random variable.
