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The following table contains the historic returns from large stocks and long-term Treasury bonds over the last 20 years. Analyze the risk-return trade-off that would
The following table contains the historic returns from large stocks and long-term Treasury bonds over the last 20 years. Analyze the risk-return trade-off that would have characterized these portfolios. 2 2 a. Calculate the average rate of return and standard deviation of the "Excess returns" after a continuous compounding transformation was performed. (Round your answers to 2 decimal places.) Portfolio Weights in StocksBonds Mean Standard deviation 0.0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1.0 0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0 d. What was the average return and standard deviation of the minimum-variance combination of stocks and bonds? (Round your answers to 2 decimal places.) Weights in Stocks Bonds 0.2277 0.7723 Portfolio Mean Standard deviation Minimum-Variance The following table contains the historic returns from large stocks and long-term Treasury bonds over the last 20 years. Analyze the risk-return trade-off that would have characterized these portfolios. 2 2 a. Calculate the average rate of return and standard deviation of the "Excess returns" after a continuous compounding transformation was performed. (Round your answers to 2 decimal places.) Portfolio Weights in StocksBonds Mean Standard deviation 0.0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1.0 0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0 d. What was the average return and standard deviation of the minimum-variance combination of stocks and bonds? (Round your answers to 2 decimal places.) Weights in Stocks Bonds 0.2277 0.7723 Portfolio Mean Standard deviation Minimum-Variance
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