Question
Some of a portfolio consists of stock A, which has an expected return of 17.55% and a standard deviation of returns of 20.68%, and the
Some of a portfolio consists of stock A, which has an expected return of 17.55% and a standard deviation of returns of 20.68%, and the rest of the portfolio consists of stock B, which has an expected return of 17.55% and a standard deviation of returns of 20.68%. If the returns of stock A and stock B do not move perfectly together in the same direction by the same relative amount, then which one of the following assertions is true? Assume that the portfolio has at least some stock A and some stock B.
| The expected return of the portfolio is 17.55% and the standard deviation of the portfolio is not 20.68 | ||
| The expected return of the portfolio is not 17.55% and the standard deviation of the portfolio is 20.68 | ||
| The expected return of the portfolio is 17.55% and the standard deviation of the portfolio is 20.68 | ||
| The expected return of the portfolio is not 17.55% and the standard deviation of the portfolio is not 20.68 | ||
| The question can not be answered without more specific information on how much of the portfolio consists of stock A and how much consists of stock B |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Money Laundering A Guide For Criminal Investigators
Authors: John Madinger , Nancy Kinnison
3rd Edition
143986912X,1439869146
