Question 2 (15 points) Suppose you can invest in two stocks: Gamestop (GME) and Apple (AAPL). Let X and Y be random variables who denote their returns. Further, you know that E[X] = E[Y] = x and Var(X) = Var(Y) = o? (Note these are likely strong assumptions in the case of GME and AAPL). As always, pxy denotes their correlation. Consider the two following investment strategies: 1. Buy 3 shares of the first stock (each with return X) and 1 share of the second stock (each with return Y) 2. Buy 2 shares of the first stock (each with return X) and 2 share of the second stock (each with return Y) For which values of 1,0?.Pxy would you prefer Strategy 2 to Strategy 1 assuming you prefer a higher mean and a lower variance of the total return of the portfolio? Question 2 (15 points) Suppose you can invest in two stocks: Gamestop (GME) and Apple (AAPL). Let X and Y be random variables who denote their returns. Further, you know that E[X] = E[Y] = x and Var(X) = Var(Y) = o? (Note these are likely strong assumptions in the case of GME and AAPL). As always, pxy denotes their correlation. Consider the two following investment strategies: 1. Buy 3 shares of the first stock (each with return X) and 1 share of the second stock (each with return Y) 2. Buy 2 shares of the first stock (each with return X) and 2 share of the second stock (each with return Y) For which values of 1,0?.Pxy would you prefer Strategy 2 to Strategy 1 assuming you prefer a higher mean and a lower variance of the total return of the portfolio