The market portfolio (M) contains the optimal allocation of only risky asset. Let the S1 be the Sharpe ratio of this market portfolio. There exists a risk-free asset. Initially, an investor is fully (100%) invested in M with a portfolio Sharpe ratio of S1. Subsequently, the investor borrows 30% at the risk-free rate, such that she is 130% invested in the market portfolio (M) where this leverage portfolio has a Sharpe ratio of S2。

After the leverage (i.e., borrowing at the risk-free rate to invest +30% in M), is the investor still on the efficient frontier and how do the Sharpe ratios?