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E ( P ) = w E ( x ) + ( 1 - w ) E ( Y ) In looking at the above

E(P)=wE(x)+(1-w)E(Y)
In looking at the above equation, you can tell that the portfolio expected return of investments x and Y
will be higher when the covariance is positive
will be lower when the covariance is negative
does not depend on covariance
will be higher when the covariance is negative
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