I understand the first portion but I'm confused on the second portion, can some one explain and show quick a calculation as to why (Wa) = 0.908

o =w,?(0.0144+0.0625-0.018)+w (-2x0.0625+0.018)+0.0625 =w,? (0.0589)+w, (-0.107)+0.0625 We want to minimize the variance of the combination portfolio with respect to wa First order condition: do dw =2w (0.0589)-0.107 =0 >WA=0.908 >E(r)=0.908x0.09+0.092x0.18=0.0982 Op =0.118