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The investor is presented with the two following stocks and she chooses to invest 40% of her portfolio in stock A. Stock A Stock B

The investor is presented with the two following stocks and she chooses to invest 40% of her portfolio in stock A.

	Stock A	Stock B
Expected Return	15%	20%
Standard Deviation	30%	40%

Which of the following statements is correct if the correlation between the stocks is 1?

	A.	The expected return of the portfolio is 18%
	B.	The standard deviation of the portfolio is 35%
	C.	The standard deviation of the portfolio is 27%
	D.	Both A and B are correct

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