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The information contained in the table below shows the expected return and standard deviation for the market and Treasury Bills. Market Data Rate of Return
The information contained in the table below shows the expected return and standard deviation for the market and Treasury Bills. | ||||||
Market Data | Rate of Return | Standard Deviation | ||||
Treasury Bills | 4.25% | 0.00% | ||||
S&P 500 | 12.00% | 21.00% | ||||
Required: | ||||||
Using the information in the table above and the varying risk aversions below, please calculate allocations to the risky and risk-free assets. | ||||||
(Use cells A5 to C6 from the given information to complete this question.) | ||||||
Risk Aversion | Percent Allocated to the Market (S&P 500) | Percent Allocated to Treasury Bills | ||||
4.00 | ||||||
2.00 | ||||||
1.50 |
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