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Please help f the past five years are: erod Stock B 40% -5% 30% -10% 35% II. The Stock A 3% 5% 1% 10% 6%

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f the past five years are: erod Stock B 40% -5% 30% -10% 35% II. The Stock A 3% 5% 1% 10% 6% 2012 2013 2014 2015 2016 (1) Base on the information provided above, calculate the expected rate of return an (2) Calculate coefficient of variation of each stock. If you only want to buy one stock, standard deviation for each stock which one will you select? Why? (3) Determine the correlation coefficient of returns of Stocks A and B. Can you reduce risk by creating a portfolio of the combination of both stocks? Why or why not? (4) Ifyou invest 80% of money on Stock A, and another 20% on Stock B, calculate expected rate of return and standard deviation of this portfolio. Is this portfolio better than individual stock A and B? Why? (21 points)

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