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Please help! 1, John Doe has the common shares of companies A and B in his portfolio, with A being 35% and B being 65%
Please help!
1, John Doe has the common shares of companies A and B in his portfolio, with A being 35% and B being 65% of the portfolio. He has made the following predictions on the returns of both companies' common shares in the coming year. [Hint: Do we need to correct for selection bias?] State of Economy rob, of State Recession Normal Boom 60% 30% 10% -38% 12% 21% -24% 9% 1396 (1) Find the standard deviations of both companies' estimated stock returns. (10 points) (2) Find the expected return on this portfolio. (10 points) (3) Find the standard deviation of this portfolio. (10 points)Step by Step Solution
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