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Suppose you have $100MM to invest. You invest $80MM in Stock A and put the rest in risk-free Treasury Bills. Suppose the rate on Treasury
Suppose you have $100MM to invest. You invest $80MM in Stock A and put the rest in risk-free Treasury Bills. Suppose the rate on Treasury Bills is 5% per year (EAY). a) Suppose the stock has a return of -4% over the coming year, what will be the return of your portfolio? b) Suppose the stocks return over the coming year has a variance of 30%. What is the standard deviation of the return
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