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3. You recently received an inheritance, and you would like to form a portfolio by investing a portion of your inheritance in an index fund

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3. You recently received an inheritance, and you would like to form a portfolio by investing a portion of your inheritance in an index fund and the remainder in a risk-free Treasury bond. If you invest thirty percent of your inheritance to in the index fund which has an expected return of 12.5% and a standard deviation of 20%, and the remainder of your inheritance in the risk- free Treasury bond that pays 4.5%. What is the expected return and standard deviation of your portfolio? (5 points) a 4. Given the following information on a U.K. stock trading on the London Stock Exchange (LSE): Dec 8, 2020 Dec 8, 2021 Price Price Dividends Share price, pounds 27,50 49.50 0.75 Exchange rate, US$/pound $1.340 $1.32 If you bought 100 shares of the stock on December 8 of 2020, received the indicated dividends over the past year and sold the stock on December 8, 2021, what is the percent return on this investment in foreign securities from the perspective of a U.S. investor? (5 points) 5

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