4) Consider the following data:

	Expected Return	Standard Deviation
Russsel Fund	16%	12%
Windsor Fund	14%	10%
S&P Fund	12%	8%

The correlation between the returns on the Russell Fund and the S&P Fund is 0.7. The rate on T-bills is 6%. Which of the following portfolios would you prefer to hold in combination with T-bills and why?

a) Russell Fund

b) Windsor Fund

c) S&P Fund

d) A portfolio of 60% Russell Fund and 40% S&P Fund.