PROBABILITY AV.R STOCKA RETURN R-AV.Ra (R-AV.R)^2* PR STOCK B R-AV.Rb (R- AV.R)^2 *PR 20% 7% -5% 15% 20% 17% 35% 3% 45% AVER RETURN VARIANCE STANDARD DEVIATIO COVARIANCE Page 2 CORRELATION IF WEIGHT A IS 40% B 60% WHAT IS THE RETURN AND RISK FOR THE PORTFOLIO