Question
An analyst gathers the following return data for two assets and constructs the follow table, R 1 is the return of Asset 1 and R1
An analyst gathers the following return data for two assets and constructs the follow table, R1 is the return of Asset 1 and R1 is the mean of the return for Asset 1, R2 is the return of Asset 2 and R2 is the mean of the return for Asset 2.
| Asset 1 | Asset 2 | ||||||
| Period | R1 (%) | R2 (%) | R1 - R1 | (R1 - R1)2 | R2 - R2 | (R2 - R2)2 | (R1 -R1)(R2 - R2) |
| T1 | 7.00 | 16.00 | -3.00 | 9.00 | 6.00 | 36.00 | -18.00 |
| T2 | 13.00 | 4.00 | 3.00 | 9.00 | -6.00 | 36.00 | -18.00 |
| T3 | 10.00 | 10.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| SUM | 30.00 | 30.00 | 18.00 | 72.00 | -36.00 | ||
| (SUM / N), where N=3 | 10.00 | 10.00 | 6.00 | 24.00 | -12.00 | ||
| SUM / (N-1), where N = 3 | 9.00 | 36.00 | -18.00 |
Based on the information above: the sample standard deviation for the returns of Asset 2 is closest to:
If the investor forms a portfolio comprised of only the two assets with 30% invested in Asset 1, then the correlation of the returns between Asset 1 and Asset 2 is closest to:
If the investor forms a portfolio comprised of only the two assets with 30% invested in Asset 1, then the portfolio's standard deviation of the returns is closest to:
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HRD Score Card 2500 Based On HRD Audit
Authors: T V Rao
1st Edition
8178298368, 978-8178298368
