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Suppose Johnson & Johnson and the Walgreen Company have the expected returns and volatilities shown below, with a correlation of 21.7%. E [ R ]
Suppose Johnson & Johnson and the Walgreen Company have the expected returns and volatilities shown below, with a correlation of 21.7%.
E [R] | SD [R] | |
Johnson & Johnson | 6.8% | 16.3% |
Walgreen Company | 10.4% | 20.1% |
For a portfolio that is equally invested in Johnson & Johnson's and Walgreen's stock, calculate:
a. The expected return.
b. The volatility (standard deviation
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