My subject is Financial management

(c) You have a portfolio with standard deviation of 30 percent and expected return of 18 percent. You are considering adding the following table. If after adding the stock you will have 20 percent of your money in the new stock and 80 percent of your money in your existing portfolio, which should you add? Why? one Type of Stock Stock A Stock B Expected Return (%) 15 15 Standard Deviation (%) 25 20 Correlation with your portfolio's return 0.20 0.60 (12 marks)