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You are considering an investment in either individual stocks or a portfolio of stocks. The two stocks you are researching, Stocks A and B hve
You are considering an investment in either individual stocks or a portfolio of stocks. The two stocks you are researching, Stocks A and B hve the following historical returns Year 2011-20.60% 2012 2013 2014 2015 37.50 14.25 4.00 26.75 13.20% 19.70 30.90 8.20 24.70 a. Calculate the average rate of return for each stock during the 5-year period. Round your answers to two decimal places Stock Stock b Suppose you had held a portfolio consisting of 50% of Stock A and S0% of Stock B what would have been the realized rate of return on the portfolio in each year? what would have been the average return on the portfolio during this period? Round Year 2011 2012 2013 2014 2015 your answers to two decimal c. Calculate the standard deviation of returns for each stock and for the portfolo. Round your answers to two decimal places. Enter negative returns with a minus sign. TB Portfolio Std. Dev d. Suppose you are a risk-averse investor. Assuming Stocks A and B are your only choices, would you prefer to hold Stock A, Stock B, or the portfolio? -Select- Stock A Stock B
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