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Below is information on two companies you are thinking of investing in: Likelihood of occurring Ding Ltd. stock returns Slam Ltd. stock returns Slow Growth

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Below is information on two companies you are thinking of investing in: Likelihood of occurring Ding Ltd. stock returns Slam Ltd. stock returns Slow Growth 25% -25% -10% 45% 10% 8% Average Growth Fast Growth 30% 20% 14% Correlation between the two companies Ding Ltd. 0.35 Slam Ltd. You would like to create a portfolio of the above two stocks. How much will you invest in each (as proportion of your portfolio) if your goal is an expected return of 8.5% per year on the average on the portfolio (10 Marks)

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