Greta has tisk aversion of A=3 when applied to return on wealth over a one-year horizon. She is pondering two portfolios, the S\&P 500 and a hedge fund, as well as a number of one-year strategies. (All rotes are annual and continuousty compounded.) The S8P 500 fisk premium is estimated at 9% per year, with a standard deviation of 17%. The hedge fund risk premium is estimated at 117% with a standard deviation of 32%. The returns on both of these portfolios in any particular year are uncorrelated with its owm returns in other years. They are also uncorreiated with the returns of the other portfolio in other years. The hedge fund claims the carrelation coefficient between the annual return on the S\&P 500 and the hedge fund return in the same year is zero, but Greta is not fully convinced by this claim. a-1. Assuming the correlation between the annual returns on the two portfolios is 0.3 , what would be the optimal asset aliocation? (Do not round intermedlate calculations. Enter your answers as decimals rounded to 4 places.) a-2. What is the expected risk premium on the portfollo? (Do not round intermediate calculations. Enter your answers as a decimal rounded to 4 places.)