stock's, known as the coveriance of returns , and so she identified the covariances given in Table 3. For example, the covariance between Alpha and Bravo is 0.0187. 3 Alpha Bravo Charlie Alpha 0146 O187 10143 Bravo 0187 O854 10104 Charlie 0143 0104 0289 Table 3: Covariance of returns She recalled thataccording to Markowitz she should let I , , , and s, be the proportion of the portfolio invested in Alpha, Bravo, and Charlie, respectively, with State =1. Markowitz showed that the expected returnof the portfolio is E=0.062x, +0.146er, +0.1285, Similarly, Markowitz showed that the portfolio's variance is the following function of covariances: V= 0146x x + .0187x x, + .0145a s, +.01875, x, +.0854x,s, + .O104, 5, +.0145x x + .0104x x, + .02895