Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on May 18, 2024

Problem 9-12 Diversifying (LG9-4, LG9-5) Consider the characteristics of the following three stocks: Expected Return Standard Deviation Thumb Devices 15% 28% 13 13 25

Problem 9-12 Diversifying (LG9-4, LG9-5) Consider the characteristics of the following three stocks: Expected Return Standard Deviation Thumb Devices 15% 28% 13 13 25 26 Air Comfort Sport Garb The correlation between Thumb Devices and Air Comfort is -0.17. The correlation between Thumb Devices and Sport Garb is -0.14. The correlation between Air Comfort and Sport Garb is 0.80. Select only two stocks for your portfolio based on low correlation and low risk.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

Step: 3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Investment Analysis and Portfolio Management

Authors: Frank K. Reilly, Keith C. Brown

10th Edition

538482109, 1133711774, 538482389, 9780538482103, 9781133711773, 978-0538482387

More Books

Students also viewed these Finance questions

Question

60% were confident there was no modern slavery present in their supply chain. 20% advised that may be some risk; however, none provided further information. 20% failed to return their...

Answered: 1 week ago

Question

The Situation It is time to negotiate a new contract with some of Lightning Wholesale's unionized employees. The company believes in dealing fairly with its employees. Based on the current economic...

Answered: 1 week ago

Question

please help me in 70 dollars to do this assignment iin APA style referencing Topic 1 & 2 Introduction to financial management and the Australian Taxation system Financial Markets 2 Learning...

Answered: 1 week ago

Question

CPA firm brings in a yoga instructor during the tax busy season to help relieve stress of the employees. Which is true about the CPA firm's ability to take a deduction for the yoga instructor's...

Answered: 1 week ago

Question

★★★★★

Compute dR/d from Equation 3-22 and show that setting dR/d = 0 gives = 45 for the maximum range. R= sin 20, 3-22

Answered: 1 week ago

Question

★★★★★

Refer to Data Set 12 in Appendix B and use the numbers of years that U.S. presidents have lived after their first inauguration.

Answered: 1 week ago

Question

★★★★★

Assume that in a lottery, 20 balls numbered 1 to 20 are put in a large bowl and then 3 balls are selected, one after the other, at random and without replacement. What is the probability that the...

Answered: 1 week ago

Question

★★★★★

Equity, Inc. is currently an all-equity financed firm. It has 10,000 shares outstanding that sell for $20 each. The firm has an operating income of $30,000 and pays no taxes. The firm contemplates a...

Answered: 1 week ago

Question

★★★★★

30% 9:13 PM .oooo AT&T LTE 215288 19162100 e PR+22-2B copy CA. Pr. 22-2B 30% 9:13 PM .oooo AT&T LTE 215288 19162100 e PR+22-2B copy CA. Pr. 22-2B

Answered: 1 week ago

Question

★★★★★

(True or False) The following function-IF (M11

Answered: 1 week ago

Question

★★★★★

In the mechanism shown in Fig. 2.53, the crank AB, 70 mm long, rotates clockwise at 110 rev/min. CD is 140 mm long. Link BD is 260 mm long and slides through a swivelling pin E at the lower end of...

Answered: 1 week ago

Question

★★★★★

At January 1 , 2 0 2 4 , Brant Cargo acquired equipment by issuing a four - year, $ 1 5 0 , 0 0 0 ( payable at maturity ) , 6 % note. The market rate of interest for notes of similar risk is 1 2 % ....

Answered: 1 week ago

Question

★★★★★

A simulation of a major traffic intersection is to be conducted, with the objectives of improving current traffic flow. Provide three iterations, in increasing order of complexity, of steps 1 and 2...

Answered: 1 week ago

Question

★★★★★

In which of the following situations a company needs to resort to the eDiscovery in an ECM system? Select one: a . The company needs to find the email addresses of its customers to send out the...

Answered: 1 week ago

Question

★★★★★

You run a restaurant, an event space and do catering for private events. You use a single, group-wide overhead allocation rate, with pricing at 145% of cost. You can make improvements by implementing...

Answered: 1 week ago

Question

★★★★★

What is total Stockholder's Equity based on the following account balances? Common Stock $400,000 Paid in Capital in Excess of par- common $50,000 Treasury Stock $20,000 Retained Earnings $380,000

Answered: 1 week ago

Question

★★★★★

A liquid flows upward through a valve situated in a vertical pipe. Calculate the differential pressure (kPa) between points A and B. The mean velocity of the flow is 4.1 m/s. The specific gravity of...

Answered: 1 week ago

Question

★★★★★

How should a bar chart be constructed when there is sample information on two or more subpopulations that needs to be displayed?

Answered: 1 week ago

Question

★★★★★

What does the height of a bar in a bar chart represent?

Answered: 1 week ago

Question

★★★★★

In the Mammography Experience Study, individuals were asked to respond to the statement You do not need a mammogram unless you develop symptoms (strongly agree, agree, disagree, strongly disagree)....

Answered: 1 week ago

Previous Question Next Question