State Super Boom Boom Normal plus Normal Normal minus Slowdown Recession Great Recession Depression Probability 0.05 0.125 0.15 0.25 0.15 0.125 0.075 0.05 0.025 GE 65.96 46.84 41.43 40.71 31.65 30.51 24.07 20.95 6.92 AMD 50.34 32.79 26.02 16.13 15.91 14.92 10.75 9.13 4.06 TWTR 29.43 10.72 3.49 5.41 15.27 21.49 -21.75 24.9 32.71 51.5 34.79 33.95 31.2 22.37 17.67 14.39 13.86 2.1 3. Consider the following information: . What is the expected return and standard deviation of each stock? . Assuming an equal weighted portfolio. What is the expected return and standard deviation on the portfolio. (Note for full credit I should be able to update any of the weights, use GE as the balance, and the answers should update) what weight on AMD would result in an Expected portfolio return of 15%. (Hint use Excel Goal seek function) Explain the resulting weights. . Look up the beta for each stock. What is the portfolio beta? You want a market beta for your portfolio. If you want to maintain 25% weights in AMD and TWTR, what are the new weights on GE and BAC? State Super Boom Boom Normal plus Normal Normal minus Slowdown Recession Great Recession Depression Probability 0.05 0.125 0.15 0.25 0.15 0.125 0.075 0.05 0.025 GE 65.96 46.84 41.43 40.71 31.65 30.51 24.07 20.95 6.92 AMD 50.34 32.79 26.02 16.13 15.91 14.92 10.75 9.13 4.06 TWTR 29.43 10.72 3.49 5.41 15.27 21.49 -21.75 24.9 32.71 51.5 34.79 33.95 31.2 22.37 17.67 14.39 13.86 2.1 3. Consider the following information: . What is the expected return and standard deviation of each stock? . Assuming an equal weighted portfolio. What is the expected return and standard deviation on the portfolio. (Note for full credit I should be able to update any of the weights, use GE as the balance, and the answers should update) what weight on AMD would result in an Expected portfolio return of 15%. (Hint use Excel Goal seek function) Explain the resulting weights. . Look up the beta for each stock. What is the portfolio beta? You want a market beta for your portfolio. If you want to maintain 25% weights in AMD and TWTR, what are the new weights on GE and BAC