Exhibit $-2$

Period

Return

$2011$

$0\mathrm{.}14$

$2010$

$-0\mathrm{.}08$

$2009$

$-0\mathrm{.}15$

$2008$

$0\mathrm{.}32$

Exhibit $-1$

Probability

Return

$30\%$

$-0\mathrm{.}05$

$50\%$

$0\mathrm{.}15$

$20\%$

$0\mathrm{.}25$

Exhibit $3$

HCA Health Corp.

HMA Heath, Inc.

Expected Return

$11\%$

$9\%$

Standard Deviation

$0\mathrm{.}22$

$0\mathrm{.}13$

Portfolio Asset Allocation

$65\%$

$35\%$

The correlation between HCA and HMA is $0\mathrm{.}25.$

Later on Andy moves on to create a two$-$stock portfolio for one of the clients who wants healthcare industry exposure. Exhibit $3$ lists the risk and return characteristics of two$-$stock, HCA Health Corp. and HMA Heath, Inc., portfolio.

Andy$$s final task for the assignment is to analyze two additional stocks, Delta Health and Canada Health The following data is available for the stocks: