S: Wealth Management are considered risk free). Suppose that the expected return on the stock portfolio is 15%, and the You are a financial advisor who works with two asset classes: stocks and Treasury bills (which a risk-averse client who has mean-variance preferences (see lecture 6, slide 12) 1 4--A-0 A. U = and would like to invest in a portfolio of stocks and T-bills/bonds. (a) For the overall portfolio consisting of stocks and bonds, draw the line of expected return against the standard deviation on your portfolio consisting of your stock portfolio and bonds. See lecture 6, slide 16. (b) Suppose your client's current overall portfolio of bonds and stocks has an expected return of 8% and standard deviation of 10%. Indicate this portfolio in your figure. Can you recommend a portfolio to your client that she will prefer to her current portfolio? Which one? Why? See lecture 6, slide 9. (c) Suppose your client wants to invest 120% of her wealth in stocks and -20% in T-bills. Show this portfolio