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3.2. Suppose you have $100,000 that you want to invest in two companies in the following table. Their correlation coefficient is 45%. Your portfolio should
3.2. Suppose you have $100,000 that you want to invest in two companies in the following table. Their correlation coefficient is 45%. Your portfolio should have a return of 15%.
Security | Price/share | E(R) | (R) |
Major Oil Company | $40 | 12% | 35% |
Callaghan Aluminum | $100 | 16% | 40% |
(A) Approximately how many shares of stock of each company should you buy?
Answer not given.
(B) What is the of the portfolio? 34.83% --- >>> (ONLY SERVES AS A GUIDE)
NOTE: PLEASE HAVE ALL ANSWER IN WORD OR EXCEL FORMAT (EDITABLE FORMAT). NO IMAGE ATTACHMENT, PLEASE!
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