a. Among those 4 portfolios, which one has the lowest total risk? Which portfolio has the lowest systematic risk? Explain your answer to each question.

b. Beta strategies: assuming the stock market is expected to enter bearish market and you want your portfolio lose the least amount of money, which of your portfolio should you choose, why do you think so?

MSFT : MCD Average Monthly Return Standard Deviation Coefficient of Variation Portfolio 1 Portfolio 2 Portfolio 3 Portfolio 4 0.8:0.2 0.6:0.4 0.4: 0.6 0.2: 0.8 0.030 0.026 0.021 0.017 0.050 0.048 0.049 0.052 1.651760 1.864032 2.280335 3.058273 Beta 0.83 :0.67 0.83 : 0.67 0.83 : 0.67 0.83 : 0.67