FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A portfolio is composed of two stocks, A and B. Stock A has a standard deviation of return of 24% while stock B has a

image text in transcribed A portfolio is composed of two stocks, A and B. Stock A has a standard deviation of return of 24% while stock B has a standard deviation of return of 18%. Stock A comprises 60% of the portfolio while stock B comprises 40% of the portfolio. If the correlation coefficient between the returns on A and B is 0.583 , then the standard deviation of return on the portfolio is 0.583 0.327 0.195 0.038

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Investment The Study Of An Economic Aggregate

Investment The Study Of An Economic Aggregate

Authors: Philip J. Lund

1st Edition

0444851380,1483256901

More Books

Students also viewed these Finance questions

Question

★★★★★
Use the following tax brackets for taxable income: Bracket ........Tax Rate $0$10,000 .........15% $10,000$50,000 ......25% $50,000$250,000 .....30% Over $250,000 ........35% Compute the average tax...

Answered: 1 week ago

Question

★★★★★
What are some ways you can make a document more concise? [LO-3]

Answered: 1 week ago

Question

★★★★★
2. Discuss the difference between communicative and instrumental body movements. Give some examples of communicative gestures.

Answered: 1 week ago

Question

★★★★★
Midlands Design Ltd. of Manchester, England, is a company specializing in providing design services to residential developers. Last year the company had net operating income of 400,000 on sales of...

Answered: 1 week ago

Question

★★★★★
Your client has $105,000 invested in stock A. She would like to build a two-stock portfolio by investing another $105,000 in either stock B or C. She wants a portfolio with an expected return of at...

Answered: 1 week ago

Question

★★★★★
Your division is considering two investment projects, each of which requires an up-front expenditure of $17 million. You estimate that the investments will produce the following net cash flows: Year,...

Answered: 1 week ago

Question

★★★★★
The Riego Hardware Store was organized on May 1 of the current year by Mr. Percival Archer Riego engaged in a whole sale trading business. The transactions for the month of May & chart of accounts...

Answered: 1 week ago

Question

★★★★★
At the beginning of 2020, Sheffield Company acquired equipment costing $175,600. It was estimated that this equipment would have a useful life of 6 years and a salvage value of $17.560 at that time....

Answered: 1 week ago

Question

★★★★★
Aylmer Corp., a public company, adopted a stock option plan on November 30, Y4, designated 120,000 common shares as available for the granting of options to officers of the corporation at an exercise...

Answered: 1 week ago

Question

★★★★★
You are working the concierge desk. A couple speaks with you to get suggestions for dinner and mentions they are strict vegetarians. The menus for the hotel restaurants have no items that are...

Answered: 1 week ago

Question

★★★★★
Based on your calculations for shipments 1, 2 and 3 of this ocean consolidation, what types) of container(s) do you estimate will be required to move the shipment? Shipment #1 Customer: Ship to:...

Answered: 1 week ago

Previous Question Next Question