Question
The two stocks have a correlation coefficient of +0.6. Your portfolio consist of 50% A and 50% B. Which of the following statement is correct?
The two stocks have a correlation coefficient of +0.6. Your portfolio consist of 50% A and 50% B. Which of the following statement is correct?
a. The portfolio's expected return is 15%.
b. The portfolio's standard deviation is greater than 20%
c. The portfolio's beta is greater than 1.2
d. The portfolio's standard deviation is 20%
the portfolio's beta is less than 1.2.
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
Contemporary Business Mathematics with Canadian Applications
Authors: S. A. Hummelbrunner, Kelly Halliday, Ali R. Hassanlou, K. Suzanne Coombs
11th edition
134141083, 978-0134141084
