Question
Consider the following two stocks. Probabilities (pipi ) Stock a Stock b Recession p1=p1= 31% -3% 4% Normal p2=p2= 20% 2% -2% Boom p3=p3= 49%
Consider the following two stocks.
| Probabilities (pipi ) | Stock "a" | Stock "b" | |
| Recession | p1=p1= 31% | -3% | 4% |
| Normal | p2=p2= 20% | 2% | -2% |
| Boom | p3=p3= 49% | 13% | 22% |
What is the expected return of each stock? Enter your answers as a percentage rounded to 2 decimal places. Do not enter the percentage sign in your answer.
Using the correct answers from the previous question, what is the standard deviation of each stock? Enter your answer as a percentage rounded to 2 decimal places. Do not enter the percentage sign in your answer.
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Asset Allocation And International Investments
Authors: G. Gregoriou
1st Edition
023001917X,0230626513
