Question
QUESTION 3 You are considering the two securities listed below. Returns Probability Securities A Securities B 25% 13% 7% 50% 15% 13% 25% 17% 33%
QUESTION 3
You are considering the two securities listed below.
Returns | ||
Probability | Securities A | Securities B |
25% | 13% | 7% |
50% | 15% | 13% |
25% | 17% | 33% |
Using these stocks, you have identified two investment portfolio alternatives:
Alternative 1 | 100% Stock A |
Alternative 2 | 40% Stock A, 60% Stock B |
e. Are the above securities being a good combination in the portfolio? Justify.
f. Calculate the portfolio return for each alternative.
g. Calculate the portfolio standard deviation for each alternative.
h. Based on the answer in f) and g), which alternatives is the best for you to choose? Justify your answer.
Dear sir don't give hand writing and please give all answer , thank you .
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