Portfolio return and standard deviation. Jamie Wong is considering building an investment portfolio containing two stocks, L and M. Stock L will represent 40% of the dollar value of the portfolio, and stock M will account for the other 60%. The expected returns over the next 6 years, 2013-2018, for each of these stocks are shown in the following table. Year Stock L expected return Stock M expected return 2013 14% 20% 2014 14% 18% 2015 16% 16% 2016 17% 14% 2017 17% 12% 2018 19% 10% a. Calculate the expected portfolio return, rp, for each of the 6 years. b. Calculate the expected value of portfolio returns, rp, (line over the r) over the 6-year period. c. Calculate the standard deviation of expected portfolio returns, orp, over the 6-year period. d. How would you characterize the correlation of returns of the two stocks L and M? e. Discuss any benefits of diversification achieved by Jamie through creation of the portfolio