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Consider the following information on Stocks A, B, C and their returns (in decimals) in each state: State Prob. of State A B C Boom
Consider the following information on Stocks A, B, C and their returns (in decimals) in each state:
State Prob. of State A B C
Boom 20% 0.25. 0.18. 0.18
Good 45% 0.13. 0.09. 0.08
Poor 25% 0.02. 0.01. 0.03
Bust 10%. -0.09 -0.05 -0.02
If your portfolio is invested 25% in A, 40% in B, and 35% in C, what is the standard deviation of the portfolio in percent? Answer to two decimals, carry intermediate calcs. to at least four decimals.
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