Portfolio expected return and risk collection of financial assets and securities is referred to as a portfolio. Most individuals and institutions invest in a portfolio, making portfolio risk nalysis an integral part of the field of finance. Just like stand-alone assets and securities, portfolios are also exposed to risk. Portfolio risk refers to Che possibility that an investment portfolio will not generate the investor's expected rate of return. Analyzing portfolio risk and return involves the understanding of expected returns from a portfolio Consider the following case: Andre is an amateur investor who holds a small portfolio consisting of only four stocks. The stock holdings in his portfolio are shown in the following table: Expected Return 6.00% Stock Artemis Inc. Babish & Co. Comell Industries Danforth Motors Percentage of Portfolio 20% 30% 35% 15% 14.00% 13.00% 3.00% Standard Deviation 38.00% 42.00% 45.00% 47.00% What is the expected return on Andre's stock portfolio? 0 15.60 14.04% 10.404 7.80 Suppose each stock in Andres portfolio has a corto che he assets and securities, portfolios are also exposed to risk. Portfolio risk the possibility that an investment portfolio will not generate the investor's expected rate of return. Analyzing portfolio risk and return involves the understanding of expected returns from a portfolio. Consider the following case: Andre is an amateur investor who holds a small portfolio consisting of only four stocks. The stock holdings in his portfolio are shown in the table: Expected Return Standard Deviation Percentage of Portfolio 20% 6.00% 38.00% Stock Artemis Inc. Babish & Co. Cornell Industries 30% 14.00% 42.00% 45.00% 35% 13.00% Danforth Motors 15% 3.00% 47.00% What is the expected return on Andre's stock portfolio? O 15.60% 14.04% O 10.40% O 7.80% Suppose each stock in Andre's portfolio has a correlation coefficient of 0.4 (p = 0.4) with each of the other stocks. If the weighted average 10.40% 7.80% Suppose each stock in Andre's portfolio has a correlation coefficient of 0.4 (p = 0.4) with each of the other stocks. If the weighted average of the risk of the individual securities (as measured by their standard deviations) included in the partially diversified four-stock portfolio is 43%, the portfolio's standard deviation () most likely is 43% expected return on Andre's stock portfolio? 5.60% -4.04% 10.40% 7.80% more than less than each stock in Andre's portfoli dividual securities (as measur deviation (op) most likely is equal to lation coefficient of 0.4 (p = 0.4) with each tandard deviations) included in the partially 43%. MacBook
