u are considering two assets with the following characteristics.

E(R1) = 0.13	E(1) = 0.13	w1 = 0.5
E(R2) = 0.21	E(2) = 0.20	w2 = 0.5

Compute the mean and standard deviation of two portfolios if r_1,2 = 0.60 and -0.65, respectively. Do not round intermediate calculations. Round your answers for the mean of two portfolios to three decimal places and answers for standard deviations of two portfolios to five decimal places.

Mean of two portfolios:

Standard deviation of two portfolios if r_1,2 = 0.60:

Standard deviation of two portfolios if r_1,2 = -0.65:

Choose the correct riskreturn graph.

The correct graph looks like?

The negative correlation coefficient reduces/increases risk without sacrificing return.