in order to utilise Fred’s stock returns (see Table 4.7) as input. Next, use the results derived from this Markowitz model as input data to Figure 4.6. Since Fred would like a return of around 12%

on his investment, run the model seven times in order to create the graph of the efficient frontier.

(Answer: Expected returns of 12.1%, 12.3% and 12.5% produce σ-values of 2.22, 2.24 and 2.44 respectively.)