Emily's goal is to have a portfolio with standard deviation of returns of less than 30%. Stocks have an average standard deviation of 35% while the correlation between stocks is 0.7. she believes she can create a portfolio of stocks with a standard deviation of less than 30% by holding 50 stocks.

1) Is Emily correct? Show all work.

2)Estimate how much greater the standard deviation of her portfolio is when compared to fully diversified portfolio?