Question: To achieve a zero standard deviation for a portfolio, calculate the weights of stock A and stock B, assuming the correlation coefficient is -1.

To achieve a zero standard deviation for a portfolio, calculate the weights of stock A and stock B, assuming the correlation coefficient is -1. Use the following information. (Round intermediate calculations and final answers to 2 decimal places, e.g. 31.21%.) State of the Probability of Expected return on Expected return on economy occurrence stock A in this state stock B in this state High growth 30% 38.5% 55.5% Moderate growth 25% 17.5% 25.5% Recession 45% -5.5% -15.5% Weight of stock A % Weight of stock B | %
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calculations Weight Calculations Weight of Stock A wA Approximately 6173 Weight of Stock B wB Approx... View full answer
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