Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The risk-free rate, average returns, standard deviations, and betas for three funds and the S&P 500 are given below. Fund Avg Std Dev Beta B
The risk-free rate, average returns, standard deviations, and betas for three funds and the S&P 500 are given below. |
Fund | Avg | Std Dev | Beta | ||||
B | 20.5 | % | 30.0 | % | 1.35 | ||
A | 14.5 | % | 25.0 | % | 1.10 | ||
C | 17.0 | % | 20.0 | % | 1.15 | ||
S&P 500 | 11 | % | 16 | % | 1 | ||
rf | 6.0 | % | |||||
If these portfolios are subcomponents that make up part of a well-diversified portfolio, then portfolio ______ is preferred. |
S&P 500 | |
C | |
A | |
B |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started