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As the expected return and variances of each asset change, the optimal portfolio is almost certain to change. Adjusting your investments with every change may cheer up your broker, but the commissions or transaction costs will slowly erode the value of your portfolio. Typically, there's a cost associated with eacch sale or purchase. Using this model, you need to take these transaction costs into account in calculating how to adjust your portfolio.

Objective of Optimization:
The objective is to determine the percent to invest in each asset while minimizing the risk of the entire portfolio.