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An Investment Adviser is helping a couple plan a retirement portfolio. The adviser has recommended three stocks: Allied Electronics, Bank United, and Consolidated Computers. Following

An Investment Adviser is helping a couple plan a retirement portfolio. The adviser has recommended three stocks: Allied Electronics, Bank United, and Consolidated Computers. Following are annual return and variance for each stock and the covariance between stocks. The couple wants a total portfolio return of at least .11. Determine the proportion of each stock to include in the portfolio to minimize the overall risk. Please solve on Excel.

Stock Annual Return Covariance
Allied Electronics .14 .10
Bank United .10 .04
Consolidated Computers .12 .08
Stock Combination (i,j) Covariance
A,B .4
A,C .7
B,C .3

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