5. Your have constructed a portfolio that invests 30% in Company X, 30% in Company Y and 40% in Company Z. The relevant forecasted data for these companies stocks are summarised in the following table:

State of ecomony

Probability of State of Economy

Rate of Return if State Occurs

Boom

Good

Poor

Bust

0.1

0.5

0.3

0.1

Company X	Company Y	Company Z
0.33	0.45	0.33
0.11	0.1	0.17
0.02	0.02	-0.05
-0.12	-0.25	-0.09

What is the expected return of the portfolio? What are the variance and standard deviation of this portfolio? In your own words, briefly explain the steps taken to calculate the portfolio expected return, variance and standard deviation. [Note: Show all formulae, workings and steps clearly. If answers are presented in a table, be sure to label all columns and rows and clearly specify formulae and steps where applicable.]