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Suppose you invest $10,000 into stock A, and $15,000 into stock B. tate Prob(State) Stock A Stock B Boom 20% 0.18 -0.05 Normal 45% 0.06
Suppose you invest $10,000 into stock A, and $15,000 into stock B.
| tate | Prob(State) | Stock A | Stock B |
| Boom | 20% | 0.18 | -0.05 |
| Normal | 45% | 0.06 | 0.15 |
| Bust | 15% | -0.09 | 0.03 |
- Calculate the weight of A in the portfolio. (Enter percentages as decimals and round to 4 decimals)
- Calculate the correlation(A,B). (Enter percentages as decimals and round to 4 decimals)
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Finance Introduction To Institutions Investments And Management
Authors: Ronald W. Melicher, Edgar A. Norton
11th Edition
0470004460, 978-0470004463
