Question
Consider the following information on two stocks: P(State) Stock A Stock B Boom 20% 0.25 0.15 Growth 30% 0.15 -0.05 Normal 20% 0.12 -0.06 Bust
Consider the following information on two stocks:
| P(State) | Stock A | Stock B | |
| Boom | 20% | 0.25 | 0.15 |
| Growth | 30% | 0.15 | -0.05 |
| Normal | 20% | 0.12 | -0.06 |
| Bust | 30% | -0.05 | 0.10 |
Suppose you invest $40,000 into stock A, and $60,000 into stock B. Calculate the variance of the portfolio. (Enter percentages as decimals and round to 4 decimals)
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Quantitative Analysis For Management
Authors: Barry Render, Ralph M. Stair, Michael E. Hanna, Trevor S. Hale
14th Edition
0137943601, 9780137943609
