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Siti Khadijah currently has a portfolio of shares giving an expected return of 1 8 % with a standard deviation of 1 0 % .

Siti Khadijah currently has a portfolio of shares giving an expected return of 18% with a standard deviation of 10%. She is considering investing in one of the following additional investments.
Hujan Panas
Berhads stock
Hujan Renyai
Berhads stock
Expected return 8%8%
Standard deviation 5%3%
Coefficient of correlation with existing portfolio -0.7+0.4
The new investment will comprise 20% of her enlarged portfolio. Clearly compute the expected rate of return, standard deviation, and coefficient variation. Based on the computation which of the two investments should Siti Khadijah ?choose19:13

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