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All answers must be entered as a formula in excel Consider the following information. Your portfolio is invested 30 percent each in A and C,
All answers must be entered as a formula in excel
Consider the following information. Your portfolio is invested 30 percent each in A and C, and 40 percent in B. What is the expected return of the portfolio? What is the variance of the portfolio? The standard deviation?
State | Probability | Stock A | Stock B | Stock C |
Boom | 0.10 | 0.35 | 0.45 | 0.27 |
Good | 0.60 | 0.16 | 0.10 | 0.08 |
Poor | 0.25 | (0.01) | (0.06) | 0.04 |
Bust | 0.05 | (0.12) | (0.20) | 0.09 |
Weights 0.30 0.40 0.30 |
Complete the following analysis. Do not hard code values in your calculations.
State | Portfolio Return | Product | Return Deviation | Squared Deviation | Product |
Boom | |||||
Good | |||||
Poor | |||||
Bust | |||||
E(R)= Variance= |
Standard Deviation=
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