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Portfolio return and standard deviation Jamie Won g is thinking of building an investment portfolio containing two exchange traded funds ( ETFs ) . Jamie
Portfolio return and standard deviation Jamie Won
g is thinking of building an investment portfolio containing two exchange traded funds ETFs Jamie plans to invest $ in Vanguard S&P ETF VOO and $ in Invesco QQQ Trust QQQ Jamie has decided to analyze some historical returns to get a sense for her portfolio's possible future risk and return. Six years of historical annual returns for each ETF are shown in the following table:
a Calculate the portfolio return, for each of the years assuming that is invested in VOO and is invested in QQQ
b Calculate the average annual return for each ETF and the portfolio over the sixyear period.
c Calculate the standard deviation of annual returns for each ETF and the portfolio. How does the portfolio standard deviation compare to the standard deviations of the individual ETFs?
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