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The following information is available regarding the two stocks listed at KSE. Suppose the return of Stock A is 10.5%, and stock B is 6.5%
The following information is available regarding the two stocks listed at KSE. Suppose the return of Stock A is 10.5%, and stock B is 6.5% while standard deviation of stock A is 6.5% while for stock B is 4.8%. The correlation between A & B is -0.50. You are required to calculate the weight of the portfolio having Risk of the Portfolio 6%. In other words, if you are willing to bear a 6% risk. How much to invest in each of the stocks. Also compute the Return of this portfolio.
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