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Q1-The expected return of the portfolio with stock B is % Q2-The expected return of the portfolio with stock C is % Q3-The Standard Deviation

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Q1-The expected return of the portfolio with stock B is %

Q2-The expected return of the portfolio with stock C is %

Q3-The Standard Deviation of Portfolio with stock B is %

Q4-The Standard Deviation of Portfolio with stock C is %

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Your client has $103,000 invested in stock A. She would like to build a two-stock portfolio by investing another $103,000 in either stock B or C. She wants a portfolio with an expected return of at least 13.5% and as low a risk as possible, but the standard deviation must be no more than 40%. What do you advise her to do, and what will be the portfolio expected return and standard deviation? Expected Return Standard Deviation Correlation with A A 15% 47% 1.00 B 12% 35% 0.12 12% 35% 0.27

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