Question
Mary, a finance student at Amity student, holds a portfolio which consists three stocks (one each) of: stock A, stock B, and stock C. Please
Mary, a finance student at Amity student, holds a portfolio which consists three stocks (one each) of: stock A, stock B, and stock C. Please note the following information about these stocks:
Stock A | Stock B | Stock C | |
Price | $120 | $84 | $96 |
Return | 20% | 15% | 10% |
Standard deviation | 0.35 | 0.1 | 0.5 |
Correlation between A and B | 0.3 |
Correlation between B and C | 0.2 |
Correlation between A and C | 0.4 |
Questions:
a- Please calculate the portfolio’s expected return
b- Please calculate the portfolio’s variance and standard deviation
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Financial Accounting A Critical Approach
Authors: John Friedlan
4th edition
1259066525, 978-1259066528
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