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Question no 8: Assuming the following data for three stocks: Probability Stock A Stock B 0.25 10% 8% 0.4 5% 12% 0.15 -10% -5% 0.2

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Question no 8: Assuming the following data for three stocks: Probability Stock A Stock B 0.25 10% 8% 0.4 5% 12% 0.15 -10% -5% 0.2 6% 5% Stock C 12% 10% -8% 0% a. Assuming you can only invest in one of them (A or B or C) which one should you invest in? Why? b. What is the expected return and standard deviation of a portfolio investing 50% in A, 25% in B and 25% in C? c. Find an investment that will dominate this portfolio

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