1. There are two securities in the market. The following chart shows their possible payoffs:

State	Probability of outcome	Return on security A	Return on security B
1	0.3	50%	-10%
2	0.5	15%	20%
3	0.2	-28%	30%

• What are the expected return and standard deviation of each security?
• What are the covariance and correlation coefficient between these two securities?

What are the expected return and standard deviation of a portfolio with 40% of its funds invested in security A and 60% in security B?