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Based on the following information regarding Stock Uno, Stock Dos and Stock Tres, Economic State Probability of State of Nature Returns - Uno Returns -
Based on the following information regarding Stock Uno, Stock Dos and Stock Tres,
Economic State | Probability of State of Nature | Returns - Uno | Returns - Dos | Returns - Tres |
Boom | 33.33% | -1.0% | 24.0% | 4.0% |
Good | 33.33% | 4.0% | 11.0% | 4.0% |
Poor | 33.33% | 12.0% | 3.0% | 4.0% |
1.Calculate the expected return and standard deviation for the three-asset portfolio assuming the portfolio consists of the following weights: a) 1/3 of Uno, 1/3 of Dos, and 1/3 Tres (meaning equal amounts of each stock in the portfolio). b) 50% Uno, 40% Dos and 10% Tres c) 0% Uno, 0% Dos, 100% Tres
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