John is looking into two investment plans offered by Petrosaudi Management. The agent points out that both investment potential growth is very promising. The investment plans are very suitable for investors like John. The agent has the following information on both plans:

Investment A: The funds are mainly invested in an emerging market like the BRICs countries. This plan forecasted reasonable expected returns of 13 percent, with a standard deviation of 21 percent. The market risk in beta for this investment plan is 0.95.

Investment B: This fund is investing in commodities such as oil and gas. The average historical return for this investment is 15 percent and carries a standard deviation of 31 percent and a beta of 1.17.

1. Based on the above information, which fund is riskier in a portfolio or individual asset context? Explain your answer. (4 marks)

2. Measure the expected return on the portfolio if you have invested an equal amount on both investments. (2 marks)

3. Compute the standard deviation for the portfolio. (3 marks)

4. Generate the beta of the portfolio. (2 marks)