Q1. Portfolio Returns

i. stock has mean of 8% and stdev of 20%;

ii bond has mean of 4% and stdev of 10%;

iii correlation b/w stock and bond of -0.2;

iv. cash return is 1% for lending and borrowing.

a. What is the mean and stdev of a portfolio of that is 2/3rd stock and 1/3rd in bond?

b. What is the mean and stdev of a fully invested yet unleveraged portfolio that assign weights based on the inverse of risk (risk parity fund, aka adjust allocation weights so the