QUESTION 4 PART A Following is the portfolio weights, w, expected return, R, vectors and the variance-covariance matrix, VC, for a threeasset portfolio: 0.5 15 100 45 10 W: 0.3 R: 12 VC= 45 64 10 0.2 10 10 10 36 Calculate: i. the expected return, and ii. standard deviation of the portfolio. (40 marks) PART B i. Briey discuss the three forms of market efciency and their implications for technical and Jndamental analysis as a basis for security selection. ii. Research on mutual fund performance suggests that mutual funds generally underperform their benchmarks, and that any superior returns is largely due to luck rather than skill. Briey discuss the implications of the research why an investor might want to buy shares of a mutual fund, in spite of the evidence of poor performance. (60 marks) Total: [100 marks]