An investor is considering investing in a small-cap stock fund and a general bond fund. The correlation between the returns of the two funds is 0.10. The returns and standard deviations are given in the following table.

	Expected Annual Return	Standard Deviation of Returns
Emerging Markets stock fund	28%	40%
Global Equities Fund	16%	21%

If the investor requires a portfolio return of 23 percent, what should the percentage invested in each fund be? Show your calculations.

What is the standard deviation of a portfolio constructed according to the weights computed in part A? Show your calculations.