You have a portfolio with a standard deviation of 23% and an expected return of 17%. You

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You have a portfolio with a standard deviation of 23% and an expected return of 17%.

You are considering adding one of the two stocks in the following table. If after adding the stock you will have 25% of your money in the new stock and 75% of your money in your existing portfolio, which one should you add?

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Fundamentals Of Corporate Finance

ISBN: 9781292437156

5th Global Edition

Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford

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Question Posted: Feb 27, 2024 03:07 AM

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You have a portfolio with a standard deviation of 23% and an expected return of 17%. You

Question:

Stock A Stock B Expected Return 16% 16% Standard Deviation 26% 19% Correlation with Your Portfolio's Returns 0.3 0.6

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Fundamentals Of Corporate Finance

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