Portfolio management is the art and science of selecting and overseeing a group of investments that meet the longterm financial objectives and risk tolerance of an investor. This study examines the risk-return characteristics of selected equity securities traded on the Indian stock market and evaluates the diversification benefits of combining them into two-asset portfolios, with reference to IIFL Securities Ltd. The analysis is based on the daily opening and closing prices of six leading companies — Reliance Industries, JSW Infra, Infosys, Jio Financial Services, Tata Motors and Bajaj Auto — for the three-month period from January 2024 to March 2024. Statistical tools such as average return, variance, standard deviation (risk), covariance and the correlation coefficient are computed for individual securities and for three asset pairs (Reliance–JSW Infra, Infosys–Jio Financial Services and Tata Motors–Bajaj Auto). The findings reveal that securities differ widely in their risk-return profiles, that high-return stocks generally carry higher risk, and that pairing securities with low or negative correlation meaningfully reduces overall portfolio risk without proportionately sacrificing returns. The study concludes that disciplined diversification, guided by correlation analysis, is an effective strategy for investors seeking an optimal balance between risk and reward.

B.Karthik Reddy, V.Beaulah Suhasini,"A Study on Risk–Return Analysis and Portfolio Management of Asset-Pair Combinations with Reference to IIFL Securities Ltd" International Journal of Advance Research in Science, Management, Engineering and Technology, V1(2): Page(128-133) May-June 2026. ISSN: 3139-1141. www.ijarsmet.com. Published by Scientific and Academic Research Publishing.