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1. You have $100,000 to invest in a Stock S and Stock T portfolio. The following table contains the essential information for the portfolio: Economic
1. You have $100,000 to invest in a Stock S and Stock T portfolio. The following table contains the essential information for the portfolio: Economic State Probability of Economy States 0.3 Expected Expected Return of Return of Stock S Stock T 19% 22% Expected Return of Portfolio Boom Normal 0.6 9% 8% Recession 0.1 3% -2% Weight for each stock 0.6 0.4 a. How much money will you invest in Stock S and Stock T, respectively? b. What is the portfolio's expected return in the boom state, normal state, and recession state, respectively? (Hint: No need to consider the probability of each economic state) sollen die bosnian od til Pib c. What are the expected return and standard deviation for the portfolio? (Hint: Considering the probability of each state)
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