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2. Portfolio Variance (10 points) a) What is the standard deviation of a portfolio of two stocks given the following data: Stock A has a

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2. Portfolio Variance (10 points) a) What is the standard deviation of a portfolio of two stocks given the following data: Stock A has a standard deviation of 30%. Stock B has a standard deviation of 18%. The portfolio contains 60% of stock A, and the correlation coefficient between the two stocks is -1. b) Could you do better in term of reducing variance? What is the lowest variance you can achieve given the data above

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