Question
A risky asset has an expected return of 12% and standard deviation of 18%. The risk-free rate is 6%. If you invest 40% of your
A risky asset has an expected return of 12% and standard deviation of 18%. The risk-free rate is 6%. If you invest 40% of your funds in the risk-free asset and 60% of your funds in the risky asset,
(A) what is your portfolios expected return,
(B) what is your portfolios standard deviation
(C) what is your portfolios reward to risk ratio?
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Financial Management Principles And Applications
Authors: J William Petty, Sheridan Titman, Arthur J Keown, John D Martin, Peter Martin, Michael Burrow, Hoa Nguyen
6th Edition
1442539178, 9781442539174
