14) An investor puts 60% of her money into stock A and 40% into stock B....
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
14) An investor puts 60% of her money into stock A and 40% into stock B. The stocks have a correlation of .7. Stock A has a variance of .17. Stock B has a variance of .10. a. What will her portfolio variance be? b. What will her portfolio standard deviation be? 14) An investor puts 60% of her money into stock A and 40% into stock B. The stocks have a correlation of .7. Stock A has a variance of .17. Stock B has a variance of .10. a. What will her portfolio variance be? b. What will her portfolio standard deviation be?
Expert Answer:
Answer rating: 100% (QA)
Given that stock A weighatge60 stock B weighatge 40 correla... View the full answer
Related Book For
Statistics For Business Decision Making And Analysis
ISBN: 9780321890269
2nd Edition
Authors: Robert Stine, Dean Foster
Posted Date:
Students also viewed these finance questions
-
The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-5. Ivan's grandfather died and left a portfolio of municipal bonds. In 2012, they pay Ivan...
-
1 If your client is not knowledgeable about the market, you should ____ versus comparable portfolios. increase the frequency of trading increase the risk of the portfolio decrease your time with the...
-
A popular theory in investment states that you should invest a certain amount of money in foreign investments to reduce your risk. The risk of a portfolio is defined as the standard deviation of the...
-
A coil of wire 0.1 m long and having 15 turns carries a current of 1.0 A. (a) Compute the flux density if the coil is within a vacuum. (b) A bar of an iron-silicon alloy, the B-H behavior for which...
-
Find in the network shown using Nortons Theorem 2 12 V 2
-
Data analytics is the process of examining data sets in order to draw conclusions about the information they contain. If you havent completed any of the prior data analytics cases, follow the...
-
Roopali is considering an investment proposal with the following cash flows: Required a. Determine the payback period b. Determine the accounting rate of return on initial investment c. Determine the...
-
Eleven years ago, Lynn Inc. purchased a warehouse for $315,000. This year, the corporation sold the warehouse to Firm D for $80,000 cash and Ds assumption of a $225,000 mortgage. Through date of...
-
Find an equation for the ellipse whose graph is shown. y F(0,3) 0 3
-
Given the following project network and baseline information below, complete the form to develop a status report for the project at the end of period 4 and the end of period 8. 0 A 2 0 2 2 2 O Task A...
-
Mitchell Industries has invested $54,000 in machinery with a 5-year useful life, and an expected salvage value of $8,000 if kept for the full 5 years. The machinery has a market value of $15,000 when...
-
Iqaluit Corporation uses FIFO and a periodic inventory system. You have been provided with the following information relating to the company's inventory for the year ended December 2021: Beginning...
-
A. For each of the situations below, draw vectors representing the electric field caused by each charge at the point indicated and use them to determine the direction of the net electric field. In...
-
An entrepreneur's ability to pursue an opportunity and turn the opportunity into a successful venture hinges on the availability of funds. Regardless of the quality of a product or service, a company...
-
Watch. Inc purchased a chocolate factory 3 years ago. Currently, the management wants to start a hotel business, and considers building a hotel on the land where the chocolate factory operates. As a...
-
b. Assume that joint production costs including fixed overhead are allocated to each product on the basis of net realizable value if sold through the cooperative's Retail Sales Division. What is the...
-
QUESTION 2 The following information relates to Maju Sdn. Bhd. RM Fixed costs per annum 60,000 Selling price per unit 20 Direct material cost per unit 3 Direct labour cost per unit Variable overhead...
-
Refer to Example 9.15. Add the following functionality to this program: Allow the user to enter the cost of a gallon of gas on each trip and use a function, Cost() to calculate the cost of purchasing...
-
A shopper in a convenience store can make a food selection from frozen items, refrigerated packages, fresh foods, or deli items. Let the event A = {frozen, refrigerated, fresh} and B = {fresh, deli}....
-
Suppose you collect data for each of the following pairs of variables. You want to make a scatterplot. Identify the response and explanatory variables. What would you expect to see in the...
-
If the airline fight that you are on is 20 minutes late departing, can you expect the pilot to make these minutes up by, say, fying faster than usual? These data summarize the status of a sample of...
-
Transatlantic Arbitrage. A corporate treasury working out of Vienna with operations in New York simultaneously calls Citibank in New York City and Barclays in London. The banks give the following...
-
Venezuelan Bolivar (A). The Venezuelan government officially floated the Venezuelan bolivar (Bs) in February 2002. Within weeks, its value had moved from the pre-float fix of Bs778/$ to Bs1025/$. a....
-
Venezuelan Bolivar (B). The Venezuelan political and economic crisis deepened in late 2002 and early 2003. On January 1, 2003, the bolivar was trading at Bs1400/$. By February 1, its value had fallen...
Study smarter with the SolutionInn App