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what does each of these represent in the formula? dont know what number to plug into this formula? thanks sure of 6 Stimal risky portfolio
what does each of these represent in the formula? dont know what number to plug into this formula?
thanks
sure of 6 Stimal risky portfolio (denoted portfolio O) to mix with T-bills; in general, the ky portfolio is the one that generates the steepest CAL. To find the composition of the optimal risky portfolio, 0, we search for weig k and bond funds that maximize the portfolio's Sharpe ratio. With only two ri can solve for the optimal portfolio weights using the following formula?: WB = = [E(TB) - roz - [E(rs) -r]OBOSPBS [E(B) ro + [E(rs) - r;]os - [E(TB) - rf + E(rs) - robosPBS Ws = 1 - WB - - - 6.10, providing the weights that maximize tho ShStep by Step Solution
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