Question
The variances of the returns on stocks A and B are each equal to 100. The returns on A and B are perfectly uncorrelated. (a)
The variances of the returns on stocks A and B are each equal to 100. The returns on A and B are perfectly uncorrelated.
(a) If your portfolio is composed of only stock A, what is its variance? (b) If your portfolio is invested half in stock A and half in stock B, what is its variance?
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Corporate Finance Reader
Authors: Robert W. Kolb
2nd Edition
1878975536, 978-1878975539
