Question
Use the following information to answer the next three questions Probability Stock A Stock B Boom 1/3 -11.5% 12.45% Normal 1/3 2.8% 6.52% Recession 1/3
Use the following information to answer the next three questions
|
|
Probability |
Stock A
|
Stock B |
|
Boom
|
1/3 |
-11.5% |
12.45% |
|
Normal |
1/3 |
2.8% |
6.52% |
|
Recession |
1/3 |
5.5% |
8.85% |
| Average Return
|
|
-1.07% |
9.27% |
| Standard Deviation () |
|
6.46% |
2.11% |
What is the portfolio return if you invest equally in Stocks A and B?
| 8.78% | |
| 9.25% | |
| 4.10% | |
| 3.95% |
What is the correlation between Stocks A and B? Using BA II Plus
| -0.3089 | |
| -0.8531 | |
| 0.3088 | |
| 0.3567 |
What is the portfolio standard deviation if you invest equally in Stocks A and B?
| 5.73% | |
| 4.39% | |
| 2.39% | |
| 8.95% |
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Real Estate Finance Theory And Practice
Authors: Terrence M. Clauretie, G. Stacy Sirmans
4th Edition
032414377X, 978-0324143775
