There are three securities in the market. The following chart shows their possible payoffs: State of Probability Return Return on Return on Security 1 Security 2 Security 3 Outcome 202 052 .36 .152 102 102 36 102 152 152 .14 .052 052 202 14 202 WN 0-1. What is the expected return of each security? (Do not round Intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Security 1 Security 2 Security 3 a-2. What is the standard deviation of each security? (Do not round Intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Security 1 Security 2 Security 3 RRR b-1. What are the covariances between the pairs of securities? (A negative answer should be indicated by a minus sign. Do not round Intermediate calculations and round your answers to 5 decimal places, e.g., 32.16162.) Security 1 & 2 Security 1 & 3 Security 2 & 3 b-2. What are the correlations between the pairs of securities? (A negative answer should be Indicated by a minus sign. Do not round Intermediate calculations and round your answers to 4 decimal places, e.g., 32.1616.) Security 1 & 2 Security 1 & 3 Security 2 & 3 c.1. What is the expected return of a portfolio with half of its funds Invested in Security 1 and half in Security 2? (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Securty 1 2 2 Security 1 & 2 c-2. What is the standard deviation of a portfolio with half of its funds invested in Security 1 and half in Security 2? (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Security 1 & 2 c-1. What is the expected return of a portfolio with half of its funds Invested in Security 1 and half in Security 3? (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Security 1 & 3 Security 183 d-2. What is the standard deviation of a portfolio with half of its funds invested in Security 1 and half in Security 3? (Leave no cells blank - be certain to enter "0" wherever required.) Security 1 & 3 e-1. What is the expected return of a portfolio with half of its funds invested in Security 2 and half In Security 3? (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Security 2 & 3 e-2. What is the standard deviation of a portfolio with half of its funds Invested in Security 2 and half in Security 3? (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Security 2 & 3
