Question
Your portfolio consists of $50,000 invested in Stock X and $50,000 invested in Stock Y. Both stocks have an expected return of 15% betas of
Your portfolio consists of $50,000 invested in Stock X and $50,000 invested in Stock Y. Both stocks have an expected return of 15% betas of 1.6, and standard deviations of 30%. The returns of the two stocks are independent, so the correlation coefficient between the, rXY, is zero. Explain the statements that best describe the characteristics of your 2-stock portfolio.
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Investments Analysis and Management
Authors: Charles P. Jones
12th edition
978-1118475904, 1118475909, 1118363299, 978-1118363294
