Question
A portfolio manager is considering the benefits of increasing his diversification by investing overseas. He can purchase shares in individual country funds with the following
A portfolio manager is considering the benefits of increasing his diversification by investing
overseas. He can purchase shares in individual country funds with the following characteristics.
India
(%)
15
10
US
(%) 12
9
UK (96
5
4
India - USA: 0.33; India - UK: 0.06: USA
UK: 0.56
Expected return Std. Deviation
Correlations
What is the expected return and S.D. of return of a portfolio with 50% invested in India and 25% each in US and UK? What will be the expected new return and risk of the portfolio if the manager changes the composition of portfolio equal to all three countries!
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Business Forecasting
Authors: John E. Hanke, Dean Wichern
9th edition
132301202, 978-0132301206
