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Show all steps and work please: Given the following probability distributions for returns on stocks A, B, and C: You invest $6,000 of your own
Show all steps and work please:
Given the following probability distributions for returns on stocks A, B, and C: You invest $6,000 of your own money in a portfolio composing of these three stocks. (a) You take a long position of $4,000 in A, a long position of $3,000 in B, and a position of $ in C. Calculate the expected rate of return and standard deviation of your 3-stock portfolio. E(RP)=;p=0.0629> (b) Assume that the inflation rate and risk free rate are, respectively, 3.5% and 4.5%, calculate the expected real rate of return, and the REAL risk premium, of your 3-stock portfolio constructed in part (a). Use the approximation version of the Fisher Equation in your calculations!Step by Step Solution
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