3. A pension fund manager is considering three mutual funds. The first is a stock second is a long-term money market fund t the risky funds are: fund, the government and corporate bond fund, and the third is a T-bill that yields a sure rate return of 5%. The probability distributions of Stock fund (S) Bond fund (B) Expected return 14% Standard Deviation 30% 20 What is the expected return and standard deviation of the minimum variance portfolio? What is the expected return and standard deviation of the optimal risky portfolio? What is the Sharpe ratio of the best feasible CAL? Suppose your client's risk aversion is 2. What is the asset allocation of his fund to the risky portfolio (i.e. y)? a. b. c. d