Question
Debt has expected return of 8% and standard deviation of 12%. Equity has expected return of 13% and standard deviation of 20%. The covariance between
Debt has expected return of 8% and standard deviation of 12%. Equity has expected return of 13% and standard deviation of 20%. The covariance between debt and equity is 0.0072. You have a portfolio that invests equally in debt and equity. What is the standard deviation of your portfolios?
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Guardians Of Finance
Authors: James R. Barth, Gerard Caprio, Ross Levine
1st Edition
0262526840, 978-0262526845
