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Consider the following information about two stocks, A and B: Stock Expected return Standard deviation A 7.00% 6.00% B 3.00% 1.50% The correlation between the

Consider the following information about two stocks, A and B:

Stock	Expected return	Standard deviation
A	7.00%	6.00%
B	3.00%	1.50%

The correlation between the two securities returns is 0.4.

(a) Calculate the expected return and standard deviation of the following three portfolios:

Portfolio	Portfolio Proportions % A	Portfolio Proportions % B
1	30	70
2	75	25
3	100	0

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