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opoint A portfolio manager is considering investing in two risky funds. The first fand is composed of bonds while the second fand is fully invested

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opoint A portfolio manager is considering investing in two risky funds. The first fand is composed of bonds while the second fand is fully invested in stocks The Tresasury bill rate is 5% Expected Return Standard Deviation Bond Fund (B) 9% 12% Stock Fund (S) 13% 19% The correlation between the two funds is 0.3 1. What are the weights of B and in the minimum-variance portfolio of the two risky funds? 2. Find the composition of the optimal risky portfolio 3. Calculate the expected return of the optimal risky portfolio. 4. Calculate the standard deviation of the optimal risky portfolio 5. What is the weight of the risk free asset in the optimal complete portfolio of an investor with a degree of risk aversion equal 3? 6. You require that your portfolio yield an expected return of 14%, and that it be efficient, on the best feasible CAL. a. What is the proportion invested in the T-bill fund and each of the two risky funds? b. What is the standard deviation of your portfolio? opoint A portfolio manager is considering investing in two risky funds. The first fand is composed of bonds while the second fand is fully invested in stocks The Tresasury bill rate is 5% Expected Return Standard Deviation Bond Fund (B) 9% 12% Stock Fund (S) 13% 19% The correlation between the two funds is 0.3 1. What are the weights of B and in the minimum-variance portfolio of the two risky funds? 2. Find the composition of the optimal risky portfolio 3. Calculate the expected return of the optimal risky portfolio. 4. Calculate the standard deviation of the optimal risky portfolio 5. What is the weight of the risk free asset in the optimal complete portfolio of an investor with a degree of risk aversion equal 3? 6. You require that your portfolio yield an expected return of 14%, and that it be efficient, on the best feasible CAL. a. What is the proportion invested in the T-bill fund and each of the two risky funds? b. What is the standard deviation of your portfolio

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