Question
An investor chooses to invest his wealth in a portfolio consisting of one share A and a risk-free asset B. The portfolio's risk is 25%.
An investor chooses to invest his wealth in a portfolio consisting of one share A and a risk-free asset B. The portfolio's risk is 25%. The share's expected return is 14% and the share's risk is 15%. The risk-free interest rate is 6%.
Calculate how large a share is to be invested in each asset to maximize the expected return.
The proportion invested in A The proportion invested in B
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Technical Analysis The Complete Resource For Financial Market Technicians
Authors: Charles Kirkpatrick, Julie Dahlquist
3rd Edition
0134137043, 978-0134137049
