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Calculate the correlation coefficient between stock A and bond B, given the following information. Total investment = 10,000 8,000 invested in stock A, 2,000 invested
Calculate the correlation coefficient between stock A and bond B, given the following information.
Total investment = 10,000
8,000 invested in stock A, 2,000 invested in stock B
Situation 1 - Good economy state, probability = 0.7, stock A return = 15%, bond B return = 4%
Calculate the correlation coefficient between stock A and bond B,
Situation 2 - Bad economy state, probability = 0.3, stock A return = 6%, bond B return = 8%
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