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Richard must decide how to allocate the capital in his portfolio. Richard has $2,000 available to invest. He finds the rates of return for four
Richard must decide how to allocate the capital in his portfolio. | ||||||||
Richard has | $2,000 | available to invest. He finds the rates of | ||||||
return for four stocks for the past 12 years and the results are given | ||||||||
below. Richard plans to invest 25% of his funds in each stock. | ||||||||
a) How much will he invest in each stock? | $ | Enter Answer | ||||||
(1 Mark) | ||||||||
b) The expected value of Richard's porfolio is: | Enter Answer | % | ||||||
(2 Marks)(Round your answer to one one-hundreth of a percent) | ||||||||
c) The standard deviation of Richard's portfolio is: | Enter Answer | % | ||||||
(1 Mark)(Round your answer to one one-hundredth of a percent) | ||||||||
Year | Stock A (%) | Stock B (%) | Stock C (%) | Stock D (%) | Enter your Final Answer Here | |||
1 | 0.200 | -0.040 | 0.760 | -0.580 | ||||
2 | 15.920 | 3.890 | -3.170 | 23.000 | ||||
3 | 25.800 | 6.360 | -5.640 | 37.820 | ||||
4 | 25.800 | 6.360 | -5.640 | 37.820 | ||||
5 | -23.400 | -5.940 | 6.660 | -35.980 | ||||
6 | 32.480 | 8.030 | -7.310 | 47.840 | ||||
7 | 49.080 | 12.180 | -11.460 | 72.740 | ||||
8 | 26.720 | 6.590 | -5.870 | 39.200 | ||||
9 | 7.000 | 1.660 | -0.940 | 9.620 | ||||
10 | 17.920 | 4.390 | -3.670 | 26.000 | ||||
11 | -11.360 | -2.930 | 3.650 | -17.920 | ||||
12 | -7.400 | -1.940 | 2.660 | -11.980 |
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