Question 2 Bpts Assume that all the stocks available to investors in a market offer the same expected return and risk (E(r) = 15% and standard deviation = 45% annually. Additionally. consider that the stocks have a common correlation coefficient of 0.2. a) What is the expected return of the optimal risky portfolio? (2 mark] b) What is the risk (standard deviation) of a portfolio containing 10 stock? [2 marks] c) How many stocks would you invest in if you want the risk of the portfolio to be 21%? [2 marks] d) During financial crises, securities presumably become more correlated with each other. In such a scenario, what is the maximum theoretical risk of a portfolio containing 50 stocks? Explain. [2 marks] Edit View Insert Format Tools Table : 12ty Paragraph BI ALT Question 2 Bpts Assume that all the stocks available to investors in a market offer the same expected return and risk (E(r) = 15% and standard deviation = 45% annually. Additionally. consider that the stocks have a common correlation coefficient of 0.2. a) What is the expected return of the optimal risky portfolio? (2 mark] b) What is the risk (standard deviation) of a portfolio containing 10 stock? [2 marks] c) How many stocks would you invest in if you want the risk of the portfolio to be 21%? [2 marks] d) During financial crises, securities presumably become more correlated with each other. In such a scenario, what is the maximum theoretical risk of a portfolio containing 50 stocks? Explain. [2 marks] Edit View Insert Format Tools Table : 12ty Paragraph BI ALT