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There is a 33% probability of an average economy and a 67% probability of an above average economy. You invest 18% of your money in
There is a 33% probability of an average economy and a 67% probability of an above average economy. You invest 18% of your money in Stock S and 82% of your money in Stock T. In an average economy the expected returns for Stock S and Stock T are 10% and 7%, respectively. In an above average economy the expected returns for Stock S and T are 28% and 32%, respectively. What is the expected return for this two stock portfolio? Portfolio Expected Return (4 decimals)
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