Exhibit 2 Optimal Domestic Portfolio Construction Capital Market Optimal domestic Line (Domestic) Expected Return portfolio (DP) of Portfolio,Rp DP R DP ◆ ◆ Minimum risk(MRDP） domestic portfolio MRpP ◆ Ri Domestic portfolio ◆ opportunity set Expected Risk DP of Portfolio,.⊙p An investor may choose a portfolio of assets enclosed by the Domestic portfolio opportunity set.The optimal domestic portfolio is found at DP,where the Security Market Line is tangent to the domestic portfolio opportunity set.The domestic portfolio with the minimum risk is designated MRppExhibit 2 Optimal Domestic Portfolio Construction Expected Return of Portfolio, Rp Expected Risk of Portfolio,)p Domestic portfolio opportunity set Rf • DP σ DP R DP An investor may choose a portfolio of assets enclosed by the Domestic portfolio opportunity set. The optimal domestic portfolio is found at DP, where the Security Market Line is tangent to the domestic portfolio opportunity set. The domestic portfolio with the minimum risk is designated MRDP . Capital Market Line (Domestic) • Minimum risk (MRDP ) domestic portfolio MRDP Optimal domestic portfolio (DP)