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Suppose Tex stock has a volatility of 36%, and Mex stock has a volatility of 18%. If Tex and Mex are uncorrelated, a. Construct a
Suppose Tex stock has a volatility of 36%, and Mex stock has a volatility of 18%. If Tex and Mex are uncorrelated, a. Construct a portfolio with positive weights in both stocks and that has the same volatility as MEX alone. b. What portfolio of the two stocks has the smallest possible volatility? a. Construct a portfolio with positive weights in both stocks and that has the same volatility as MEX alone. The portfolio of the two stocks that has the same volatility as Mex alone consists of % of Tex stock and % of Mex stock. (Round to one decimal place.)
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