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You are a salesman/investment advisor working for a major investment bank. Whenever clients contact you with money to invest, your job is to help them
You are a salesman/investment advisor working for a major investment bank. Whenever clients contact you with money to invest, your job is to help them find an appropriate mutual fund to invest in given their financial position. The available investments are: Fund A B C E[R] E[R] 10% 20% 20% (R) 15% 45% 55% Assume throughout this problem that you only recommend one of the three funds to your clients (possibly a different recommendation for different clients though). a) Would you recommend investment C to someone who comes to you with all his investment funds? Explain b) Which investment would you recommend to Keith Richards, the really, really old rock star from the Rolling Stones? Assume he invests all his wealth in your particular recommendation. c) Might your answer to b) change if Keith invests only half his wealth in your particular recommendation? If so, under what circumstances
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