Question 6 1) Use the data below to answer the following: Security Expected Return Standard Deviation 0.07 0.00 0.10 0.15 3 0.20 0.20 a) Assume P23 = -0.65 and your portfolio consists of security 2 and of security 3. If your portfolio consists of 40% security 2 and 60% security 3, find the expected return and standard deviation of your portfolio. (2.5 marks) b) Now assume P23 = -1.00 and your portfolio consists of security 2 and of security 3 Using the formulae for the minimum variance portfolio, provided below, determine the portfolio weights that would give you the minimum standard deviation portfolio. (2.5 marks) X2 x =1-x Oq+0 On the graph below, carefully plot the feasible set of portfolios of securities 2 and 3 if P23--1.00. Ensure that you identify security 2, security 3, and the minimum variance portfolio. (1 mark) c) Expected Return E[R] esc Fir