Question
A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund,
| A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a sure rate of 5.5%. The probability distributions of the risky funds are: |
| Expected Return | Standard Deviation | |
| Stock fund (S) | 15% | 32% |
| Bond fund (B) | 9 | 23 |
| The correlation between the fund returns is .15. |
| Required: |
| What expected return and standard deviation for the minimum-variance portfolio of the two risky funds? (Answer is in % form (XX.XX%), not decimal form (0.XXXX) Round your answers to 2 decimal places. Omit the "%" sign in your response.) |
| Expected return | % |
| Standard deviation | % |
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The Social Media Handbook For Financial Advisors
Authors: Matthew Halloran
1st Edition
1118208013, 978-1118208014
