Per the Allocation spreadsheet we learned in class, we have the outputs as follows: Minimum Variance Portfolio Weight Bonds Weight Stocks Return Risk 0.91915 0.08085 0.2935% 0.9362% Optimal Risky Portfolio Weight Bonds Weight Stocks Ex Ret St Dev. 0.75326 0.24674 0.4066% 1.1034% Reward to Variability 0.36600 If you invest only in bonds and stocks (i.e. no t-bills) and you want to reduce your risk, you could do so by increasing the proportion in bonds. However, you should not increase the proportion more than Per the Allocation spreadsheet we learned in class, we have the outputs as follows: Minimum Variance Portfolio Weight Bonds Weight Stocks Return Risk 0.91915 0.08085 0.2935% 0.9362% Optimal Risky Portfolio Weight Bonds Weight Stocks Ex Ret St Dev. 0.75326 0.24674 0.4066% 1.1034% Reward to Variability 0.36600 If you invest only in bonds and stocks (i.e. no t-bills) and you want to reduce your risk, you could do so by increasing the proportion in bonds. However, you should not increase the proportion more than