Question
Returns and Standard Deviations Consider the following information: State of economy Probability of state of economy Rate of return if state occurs Stock A Stock
Returns and Standard Deviations Consider the following information:
| State of economy | Probability of state of economy | Rate of return if state occurs | ||
|
|
| Stock A | Stock B | Stock C |
| Boom | .20 | .24 | .45 | .33 |
| Good | .35 | .09 | .10 | .15 |
| Poor | .40 | .03 | -.10 | -.05 |
| Bust | .05 | -.05 | -.25 | -.09 |
a.Your portfolio is invested 30 percent each in A and C and 40 percent in B. What is the expected return of the portfolio? b.What is the variance of this portfolio? The standard deviation?
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Mission Ready Finances Proven Principles To Guide Your Story To Financial Freedom
Authors: Marco Parzych
1st Edition
173321531X, 978-1733215312
