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What is the total variance of the portfolio when 20% of the value is financed by a loan? Find the total variance for a portfolio
What is the total variance of the portfolio when 20% of the value is financed by a loan?
Find the total variance for a portfolio containing both shares A and B and where stock A represents a share of 130% of the portfolio and stock B represents a share of -30% of the portfolio and where the unsystematic risk on the portfolio is given by Var(EB) = 2,72. BA 0,7 1,2 36 Var(Rm) Weight (A) Weight(B) Var(CAB) 130% -30,00% - 2,72 PF-Beta PF-variance 0,55 13,61 The investor has decided that it will be a better idea to finance parts of his portfolio through borrowed money. Suppose the investor can borrow through a risk-free asset. Find the total variance of the portfolio from when 20% of the value is financed by a loan. Find the total variance for a portfolio containing both shares A and B and where stock A represents a share of 130% of the portfolio and stock B represents a share of -30% of the portfolio and where the unsystematic risk on the portfolio is given by Var(EB) = 2,72. BA 0,7 1,2 36 Var(Rm) Weight (A) Weight(B) Var(CAB) 130% -30,00% - 2,72 PF-Beta PF-variance 0,55 13,61 The investor has decided that it will be a better idea to finance parts of his portfolio through borrowed money. Suppose the investor can borrow through a risk-free asset. Find the total variance of the portfolio from when 20% of the value is financed by a loanStep by Step Solution
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