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Consider two portfolios, one composed of four securities and the other of ten securities. All the securities have a beta of 1 and idiosyncratic risk

Consider two portfolios, one composed of four securities and the other of ten securities. All the securities have a beta of 1 and idiosyncratic risk of 30%. Each portfolio distributes weight equally among its component securities. If the standard deviation of the market index is 20%, calculate the total risk of both portfolios.

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