Question
Create a portfolio using the four stocks and information below: Expected Return Standard Deviation Weight in Portfolio Stock A 29.00% 27.00% 17.00% Stock B 30.00%
Create a portfolio using the four stocks and information below:
Expected Return | Standard Deviation | Weight in Portfolio | |
Stock A | 29.00% | 27.00% | 17.00% |
Stock B | 30.00% | 40.00% | 13.00% |
Stock C | 16.00% | 21.00% | 25.00% |
Stock D | 11.00% | 24.00% | 45.00% |
---------------------- | ---------------------- | ---------------------- | ---------------------- |
Correlation (A,B) | 0.8200 | ---------------------- | ---------------------- |
Correlation (A,C) | 0.1100 | ---------------------- | ---------------------- |
Correlation (A,D) | 0.6800 | ---------------------- | ---------------------- |
Correlation (B,C) | 0.2800 | ---------------------- | ---------------------- |
Correlation (B,D) | 0.9700 | ---------------------- | ---------------------- |
Correlation (C,D) | 0.1900 | ---------------------- | ---------------------- |
(Do not round intermediate calculations. Record your answers in decimal form and round your answers to 4 decimal places. Ex. x
What is the Covariance (A,A)?
0.0729
What is the Covariance (A,B)?
0.0886
What is the Covariance (A,C)?
0.0062
What is the Covariance (A,D)?
0.0440
What is the Covariance (B,A)?
0.0886
What is the Covariance (B,B)?
0.16
What is the Covariance (B,C)?
0.0235
What is the Covariance (B,D)?
0.0931
What is the Covariance (C,A)?
0.0062
What is the Covariance (C,B)?
0.0235
What is the Covariance (C,C)?
0.0441
What is the Covariance (C,D)?
0.0096
What is the Covariance (D,A)?
0.0440
What is the Covariance (D,B)?
0.0931
What is the Covariance (D,C)?
0.0096
What is the Covariance (D,D)?
0.0576
What is the expected return on the portfolio above?
0.1778
What is the variance on the portfolio above?
What is the standard deviation on the portfolio above?
*answer the last two questions
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started