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Suppose Johnson & Johnson and the Walgreen Company have the expected returns and volatilities shown below, with a correlation of 21.2%. E [ R ]
Suppose Johnson & Johnson and the Walgreen Company have the expected returns and volatilities shown below, with a correlation of 21.2%.
E [R] | SD [R] | |
Johnson & Johnson | 7.2% | 15.4% |
Walgreen Company | 10.3% | 20.1% |
For a portfolio that is equally invested in Johnson & Johnson's and Walgreen's stock, calculate:
a. The expected return.
The expected return of the portfolio is enter your response here%. (Round to one decimal place.)
b. The volatility (standard deviation).
The volatility of the portfolio is enter your response here%. (Round to one decimal place.)
.
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