Please compute wSP Y , wAGG, E(rP ), rP , and Sharpe Ratio of the optimal portfolio constructed using SPY and AGG. (Show your work)

If you require that your overall complete portfolio have an expected return of 4%, what are the allocation percentages to SPY, AGG, and t-bills for your complete portfolio. (Show your work and round your answer to 4 decimal places)

1. You are a portfolio manager attempting to construct an optimal risky portfolio for your clients. You have at your disposal the iShares Core US Bond Index ETF (AGG), the SPDR S\&P 500 ETF (SPY), and a portfolio of t-bills that are yielding 1% annually. Please answer the following: a. Please tabulate and draw on the graph below the minimum variance frontier using SPY and AGG. Use allocations ranging from wSPY=0% to wSPY=100%, in increments of 10%. Remember the wSPY+wAGG=1 at all times. You will use this graph throughout the remainder of the handout. Construct the allocation table here. 1. You are a portfolio manager attempting to construct an optimal risky portfolio for your clients. You have at your disposal the iShares Core US Bond Index ETF (AGG), the SPDR S\&P 500 ETF (SPY), and a portfolio of t-bills that are yielding 1% annually. Please answer the following: a. Please tabulate and draw on the graph below the minimum variance frontier using SPY and AGG. Use allocations ranging from wSPY=0% to wSPY=100%, in increments of 10%. Remember the wSPY+wAGG=1 at all times. You will use this graph throughout the remainder of the handout. Construct the allocation table here