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Consider the following information for stocks X and Y below: Stock Expected Return Standard Deviation X 4.70% 15% Y 18.50% 7% Assume that the return

Consider the following information for stocks X and Y below:

Stock Expected Return Standard Deviation
X 4.70% 15%
Y 18.50% 7%

Assume that the return on the market is 20%, the risk-free rate is 5%, and the correlation between the two stocks = -0.30.

Your client wants you to create a portfolio consisting of Stocks X and Y with a beta equal to 0.45. If your client has $250,000, compute how much (in $) you would invest in each stock, and then compute the expected return (in%) and standard deviation (in %) of the portfolio.

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