Question
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% | 0.34 | 0.23 | 0.2 |
| Good | 45% | 0.16 | 0.12 | 0.09 |
| Poor | 25% | 0.02 | 0.02 | 0.03 |
| Bust | 10% | -0.1 | -0.06 | -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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Stock Market Investing For Beginners
Authors: Andrew P.C.
1st Edition
1549522132, 978-1549522130
