FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Consider the following securities: Expected Return Standard Deviation of Return Stock A 12% 20% Stock B 15% 28% What is the expected return on Portfolio

Consider the following securities:

Expected Return Standard Deviation of Return
Stock A 12% 20%
Stock B 15% 28%

What is the expected return on Portfolio P which holds 45% of Stock A and 55% of Stock B, assuming a correlation between the two stocks of -0.2?

A. 2.6%

B. 16.2%

C. 13.65%

D. 19.3%

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Investments

Investments

Authors: William F. Sharpe, Gordon J. Alexander, Jeffery V. Bailey

6th Edition

8120321014, 978-8120321014

More Books

Students also viewed these Finance questions

Question

★★★★★
What is a differential? How is a differential treated by an investor in computing income from an investee under (a) Cost-method and (b) Equity-method reporting?

Answered: 1 week ago

Question

★★★★★
Which of the following staterments about Java wrapper classes is incorrect? An instance of the wrapper class will not be a reference type if the value that is wrapped is not a reference type. A...

Answered: 1 week ago

Question

★★★★★
=+ What are the undesirable consequences?

Answered: 1 week ago

Question

★★★★★
The B-string of a guitar is made of steel (density 7800 kg/m3), is 63.5 cm long, and has diameter 0.406 mm. The fundamental frequency is f= 247.0 Hz. (a) Find the string tension. (b) If the tension F...

Answered: 1 week ago

Question

★★★★★
1 Function: PV; Formula: Subtract; Cell Referencing 2. 3 BE20.11 - Using Excel to Account for Leases 4 PROBLEM 5 Merrill Corporation, which uses ASPE, enters into a six-year lease of 6 equipment on...

Answered: 1 week ago

Question

★★★★★
reducing the ordering/setup cost can lead ot less cycle inventory

Answered: 1 week ago

Question

★★★★★
( a ) Explicitly state the wastes that you see in the U - profile in Part 3 . State if the process is balanced or not. Briefly discuss the effects of the wastes on production, revenue, and profit.

Answered: 1 week ago

Question

★★★★★
Referring to KMART Transaction Process, please help me to figure out these question - Based on your experience with the process, identify an improvement opportunity. Adjust your process model,...

Answered: 1 week ago

Question

★★★★★
In "The New Momism," Susan Douglas and Meredith Michaels chart a "set of ideals, norms, and practices" that have emerged and gained in strength since the 1980s. Propagated in large part by mainstream...

Answered: 1 week ago

Question

★★★★★
getBarbrood ustuprates of bloq mont triog rose heyro 11. Eliminate the parameter from the parametric equations - x(t)=t 1, y(t) = log(2t). (OS)=(S)

Answered: 1 week ago

Question

★★★★★
6. What resources are available to the front office manager? Rank the importance of these resources in providing service to guests and supervising employees. 7. How does the front office manager...

Answered: 1 week ago

Question

★★★★★
c. What steps can you take to help eliminate the stress?

Answered: 1 week ago

Question

★★★★★
b. Are there any aspects of the situation that are out of your control? Explain.

Answered: 1 week ago

Question

★★★★★
What is the scheduling pattern (optional): continuous, flighting, pulsing, or massing?

Answered: 1 week ago

Previous Question Next Question