Guys, I’m slightly confused, the Markowitz theory states that the efficient portfolio is well diversified, ie eliminating unsystematic risk and therefore having assets that are negatively correlated to one another. Now what do they mean when they say: "This straight efficient frontier line is called the capital market line (CML). Since the line is straight, the math implies that any two assets falling on this line will be perfectly, positively correlated with each other. " Do they mean two different portfolios or individual assets they make up the portfolio? I thought at this point the assets would be negatively correlated? Some explanation would be greatly appreciated. thanks