Expected return and risk:

Andre is an amateur investor who holds a small portfolio consisting of only four stocks. The stock holdings in his portfolio are shown in the following table: Percentage of Portfolio 20% 30% 35% 15% Expected Return 6.00% 14.00% 12.00% 3.00% Standard Deviation 37.00% 41.00% 44.00% 46.00% Stock Artemis Inc. Babish & Co. Cornell Industries Danforth Motors What is the expected return on Andre's stock portfolio? 7.54% 15.08% 13.57% 10.05% Suppose each stock in Andre's portfolio has a correlation coefficient of 0.4 ( = 0.4) with each of the other stocks. If the weighted average of the risk of the individual securities (as measured by their standard deviations) included in the partially diversified four-stock portfolio is 42%, the portfolio's standard deviation (op) most likely is 42%