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Hello, please help. I will upvote accordingly. Thank you in advance. You currently hold a portfolio that has SPY, MSFT, AAPL, and WFC in it.

Hello, please help. I will upvote accordingly. Thank you in advance. image text in transcribedimage text in transcribed

You currently hold a portfolio that has SPY, MSFT, AAPL, and WFC in it. You are considering adding BA stock to it. Table below summarizes historical data analysis for (1) SPY, (2) Portfolio of (SPY, MSFT, AAPL, and WFC), (3) BA stock, and (4) New Portfolio that is based on the old portfolio with BA stock added to it. SPY Portfolio (SPY, MSFT, AAPL, WFC) BA Portfolio + BA Summary Statistics Average Variance St.Dev. 0.7096 0.0014 3.71% 1.0496 0.0022 4.6496 1.4396 0.0038 6.2096 1.09% 0.0020 4.4396 Regression Analysis Summary Intercept Beta 0.00204 1.20562 0.00793 0.92070 0.00287 1.15489 1 Var (residuals) St. Dev. residuals) 0.000149 1.22% 0.002676 5.17% 0.000126 1.129 Rf 0.05% R (CAPM) Jensen Alpha Treynor Index Sharpe Ratio M 0.0065 0.1740 0.0082 0.2142 0.0150 0.2231 0.0090 0.2350 8. Based on Information Ratio and Potential Sharpe Ratio Approach, should you add BA stock to the portfolio? a. Yes, adding BA stock can potentially improve the Sharpe Ratio up to 0.2231 b. Yes, adding BA stock can potentially improve the Sharpe Ratio up to 0.2350 Yes, adding BA stock can potentially improve the Sharpe Ratio up to 0.2635 d. Yes, adding BA stock can potentially improve the Sharpe Ratio up to 0.3398 e. No, Potential Sharpe Ratio of the portfolio will be reduced after adding BA stock to it c

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