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3. A two stock (A & B) portfolio is formed. The expected returns are ra = 10% and rb = 15%. The standard deviation
3. A two stock (A & B) portfolio is formed. The expected returns are ra = 10% and rb = 15%. The standard deviation for Stock A is 12% and 15% for Stock B. If the correlation coefficient of the two stock is 0.5, calculate the portfolio's standard deviation. Assume 40% is invested in A and 60% in B.
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To calculate the standard deviation of a twostock portfolio you can use the f...
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Investments Analysis and Management
Authors: Charles P. Jones
12th edition
978-1118475904, 1118475909, 1118363299, 978-1118363294
