=+LG 3 P8–13 Portfolio return and standard deviation Jamie Wong is thinking of building an investment portfolio containing two stocks, L and M. Stock L will represent 40%

of the dollar value of the portfolio, and stock M will account for the other 60%.

The historical returns over the last 6 years, 2013–2018, for each of these stocks are shown in the following table.

X MyLab Expected return Year Stock L Stock M 2013 14% 20%

2014 14 18 2015 16 16 2016 17 14 2017 17 12 2018 19 10