4. You estimate that a passive portfolio, that is, one invested in a risky portfolio that mimics the S&P 500 stock index, yields an expected rate of return of 13% with a standard deviation of 25%. You manage an active port- folio with expected return 18% and standard deviation 28%. The risk-free rate is 8%. a) Calculate and interpret the return of the P* portfolio[2] b) Draw the CML and your funds CAL on an expected returnstandard deviation diagram. [2] c) Explain in one short paragraph the advantage/disadvantage of your P* over the passive fund. [3] d) Your client ponders whether to switch the 70%of his wealth to the passive portfolio. Explain to your client the disadvantage/advantage of the switch. [3]