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8. A hedge fund has created a portfolio using just two stocks. It has shorted $35,000,000 worth of Oracle stock and has purchased $85,000,000 of
8. A hedge fund has created a portfolio using just two stocks. It has shorted $35,000,000 worth of Oracle stock and has purchased $85,000,000 of Intel stock. The correlation between Oracle's and Intel's returns is 0.65. The expected returns and standard deviations of the two stocks are given in the following table below:
a. What is the expected return of the hedge fund's portfolio? (Round to two decimal places.)
b. What is the standard deviation of the hedge fund's portfolio? (Round to two decimal places.)
A hedge fund has created a portfolio using just two stocks. It has shorted $35,000,000 worth of Oracle stock and has purchased $85,000,000 of Intel stock. The correlation between Oracle's and Intel's returns is 0.65 . The expected returns and standard deviations of the two stocks are given in the following table: a. What is the expected return of the hedge fund's portfolio? b. What is the standard deviation of the hedge fund's portfolio? Data table (Click on the following icon in order to copy its contents into a spreadsheet.)Step by Step Solution
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