What is the expected return of investing equally in all three assets M, N, and O?

(Round to two decimal places.)

What is the expected return of investing in asset M alone?

(Round to two decimal places.)

What is the standard deviation of the portfolio that invests equally in all three assets M, N, and O?

(Round to two decimal places.)

What is the standard deviation of asset M?

(Round to two decimal places.)

By investing in the portfolio that invests equally in all three assets M, N, and O rather than asset M alone, Sally can benefit by increasing her return by_______

and decreasing her risk by_______.

Homework: Chapter 8 Homework Save Score: 0.92 of 1 pt 8 of 9 (9 complete) HW Score: 99.15%, 8.92 of 9 pts WP8-24 (similar to) s Question Help Benefits of diversification. Sally Rogers has decided to invest her wealth equally across the following three assets: a. What are her expected returns and the risk from her investment in the three assets? How do they compare with investing in asset Malone? Hint. Find the standard deviations of asset M and of the portfolio equally invested in assets M, N, and O. b. Could Sally reduce her total risk even more by using assets M and N only, assets M and O only, or assets N and O only? Use a 50/50 split between the asset pairs, and find the standard deviation of each asset pair. a. What is the expected return of investing equ i Data Table % (Round to two decimal places.) (Click on the following icon in order to copy its contents into a spreadsheet.) States Boom Normal Recession Probability 29% 48% 25% Asset M Return 10% 8% 2% Asset N Return 19% 12% - 1% Asset Return 2% 8% 10% Print Done Enter your answer in the answer box and then click Check Answer. ? 11 parts Clear All Check Answer remaining