FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Consider a portfolio of two stocks, A and B. The expected return on Stock A next year is 22% with a standard deviation of 14%.

Consider a portfolio of two stocks, A and B. The expected return on Stock A next year is 22% with a standard deviation of 14%. The expected return on Stock B next year is 8% with a standard deviation of 6%. The correlation between the two stocks is 0.3. If 70% of the portfolio is in Stock A and 30% in Stock B, what is the standard deviation of the portfolio?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction To Personal Finance Beginning Your Financial Journey

Introduction To Personal Finance Beginning Your Financial Journey

Authors: Lance Palmer, John E. Grable

2nd Edition

1119797063, 978-1119797067

More Books

Students also viewed these Finance questions

Question

★★★★★
For each of the following cases, provide the missing information. Noel Frehley is examining the accounts receivable of Kiss Company and is considering the use of MUS. Kisss accounts receivable are...

Answered: 1 week ago

Question

★★★★★
When a copy of a variable is sent to a method, it is passed by _ _ _ _ . a . value b . inference c . reference d . insinuation

Answered: 1 week ago

Question

★★★★★
11.11 Writing a Bad-News Message about Elimination of Elite Customer Program (LO11.4) Assume the role of Nick and write a bad-news announcement to all former Elite Customers explaining the...

Answered: 1 week ago

Question

★★★★★
What tools can be used for financial statement analysis? What do these tools tell you about financial performance? What kinds of business decisions can be made using these tools in a company or...

Answered: 1 week ago

Question

★★★★★
Consider a portfolio of two stocks, A and B. The expected return on Stock A next year is 22% with a standard deviation of 14%. The expected return on Stock B next year is 8% with a standard deviation...

Answered: 1 week ago

Question

★★★★★
PRACTICE QUESTIONS GHS'000 24.600 6,000 Question One The following trial balance relates to Faith at 30 September 2008: GHS'000 Leasehold property - at valuation 1 October 2007 (note (i)) 50,000...

Answered: 1 week ago

Question

★★★★★
Comprehension: Wooden chair manufacturing is a huge business for families living in the outskirts of Moradabad, Uttar Pradesh. These families, around a hundred in number, have been making wooden...

Answered: 1 week ago

Question

★★★★★
Consider a processing center that can be purchased at $25000 today and will have a 10 years of useful lifetime, in the end of which the processing center is expected to have a salvage value of $5000....

Answered: 1 week ago

Question

★★★★★
The Hope Manufacturing Co. uses a Raw and In Process (RIP) inventory account and expensed all conversion costs to the cost of goods sold account. At the end of each month, all inventories are...

Answered: 1 week ago

Question

★★★★★
Explain what stable data responding say about the environmental conditions under which it occurred. Identify (2) reasons why an investigator should be concerned about trends in the data that have no...

Answered: 1 week ago

Question

★★★★★
Healthcare information technology has been promoted by researchers, the government, and others as increasing the quality of patient care. How is this assumption supported? Provide a list and a...

Answered: 1 week ago

Question

★★★★★
What are cafeteria plans? What is one advantage and one disadvantage to these plans? Would you want to participate in this type of healthcare plan?

Answered: 1 week ago

Question

★★★★★
What is the difference between training and professional development? Describe your training and professional development experiences that were motivating or not motivating to you.

Answered: 1 week ago

Question

★★★★★
Discuss the role labor unions have in the nursing sector of health care. Do you know any nurses who belong to a union?

Answered: 1 week ago

Previous Question Next Question