Question
Consider the following information. Security Return Standard Deviation Beta Coefficient of Correlation =-0.7 X 15.0% 12.0% 1.5 Y 8.0% 10.0% 1.0 a) Which security (X
Consider the following information.
| Security | Return | Standard Deviation | Beta | Coefficient of Correlation =-0.7 |
| X | 15.0% | 12.0% | 1.5 | |
| Y | 8.0% | 10.0% | 1.0 |
a) Which security (X or Y) in the above table has the least systematic risk? Why?
b) Using the data from the above table, calculate the portfolio standard deviation and the portfolio beta if you invest $6,000 in security X, and $14,000 in security Y.
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Financial Management Theory And Practice
Authors: Prasanna Chandra
8th Edition
0071078401, 978-0071078405
