Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Suppose that you want to create a portfolio that consists of a corporate bond fund, X, and a common stock fund, Y. For a $1,000

image text in transcribed

Suppose that you want to create a portfolio that consists of a corporate bond fund, X, and a common stock fund, Y. For a $1,000 investment, the expected return for X is $80 and the expected return for Y is $105. The variance for X is 1,625 and the variance for Y is 13,475. The covariance of X and Y is 3,951. Complete parts (a) through (d). a. Compute the portfolio expected return and portfolio risk if you put $200 in the corporate bond fund and $800 in the common stock fund. The portfolio expected return is $ 100.00 (Type an integer or a decimal. Do not round.) The portfolio risk is $- (Round to two decimal places as needed.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Shariah Audit Framework A Case Study Of UAE Noor Takaful Operations

Authors: Abdussalam Ismail Onagun

1st Edition

3659644064, 978-3659644061

More Books

Students also viewed these Accounting questions