Risk and return You are considering an investment in the stock market and have identified three potential stocks, they are Crown (ASX1CWN), Tencent (HKG: 03'00) and Commonwealth Bank (ASX: CBA). The historical prices for the past 10 years are shown in the table below. Assume no dividend is distributed during this period. Commonwealth (EBA) 2010 176 29.04 53.63 52.15 50.39 m 64.10 2014 15.68 103.70 73.83 E 78.6? 2018 13.25 463.60 78.87 -_m 69.91 1. (6 marks) Calculate the return and risk (standard deviation) of each stock. 2. (3 marks) Explain the reiation (positive or negative) between risk and return based on your answers in part (1). 3. (6 marks) Calculate the W between (a) Crown and Tencent and (b) Tencent and CBA. 4. (3 marks) Calculate the expected (annual) return and standard deviation if you owned a portfolio consisting of 50% in Crown and 50% in Tencent. 5. (3 marks) Calculate the expected (annual) return and standard deviation if you owned a portfolio consisting arm in CBA and 60% in Tencent. 6. (4 marks) Which portfolio (parts 4 or 5) provides better diversication? Explain your answer(s)