Question
Bank A has an expected return of 7% with standard deviation of 30%. Bank B has expected return of 10% with standard deviation of 40%.
Bank A has an expected return of 7% with standard deviation of 30%. Bank B has expected return of 10% with standard deviation of 40%. If the return correlation is 0.5, the volatility of an equally weighted portfolio of both banks equals?
The answer is 0.304
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Accounting Principles Part 2
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Kinnear, Joan E. Barlow
6th Canadian edition Volume 1
1118306791, 978-1118306796
