FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You are forming a complete portfolio of Stock A and a risk-free security. Stock A has an expected return of 18% and a standard deviation

You are forming a complete portfolio of Stock A and a risk-free security. Stock A has an expected return of 18% and a standard deviation of 25%. The risk-free rate is 1%. You have already determined your complete portfolio will be invested 70% in Stock A and 30% in the risk-free security.

(A): What is the variance?

(B): What is the Sharpe ratio?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Handbook Of Mergers And Acquisitions

The Handbook Of Mergers And Acquisitions

Authors: David Faulkner, Satu Teerikangas, Richard J. Joseph

1st Edition

0199601461, 978-0199601462

More Books

Students also viewed these Finance questions

Question

★★★★★
Even with campaigns to reduce smoking, Americans still consume more than four packs of cigarettes per month per adult (libraries.ucsd.edu/ssds/pub/(libraries.ucsd.edu/ssds/pub/CTS/tobacco/sales). The...

Answered: 1 week ago

Question

★★★★★
5. Why are time lines helpful in evaluating capital projects?

Answered: 1 week ago

Question

★★★★★
Marya Callais, a citizen of Florida, was walking along a busy street in Tallahassee, Florida, when a large crate flew off a passing truck and hit her, causing numerous injuries. She experienced a...

Answered: 1 week ago

Question

★★★★★
You are forming a complete portfolio of Stock A and a risk-free security. Stock A has an expected return of 18% and a standard deviation of 25%. The risk-free rate is 1%. You have already determined...

Answered: 1 week ago

Question

★★★★★
Activity - Based Costing Total cost per two - day course = R M 5 + R M 4 8 2 + ( R M 4 3 . 8 5 2 ) + R M 3 8 0 + R M 9 5 0 + R M 5 1 . 3 2 + R M 1 0 = R M 1 , 9 6 6 . 0 2 per two - day course Total...

Answered: 1 week ago

Question

★★★★★
For a new product in our company we need to use with the following plants in order to maximize the output: Petrochemical plant, Steel plant, and Electric plant. The current objective is 1000. The...

Answered: 1 week ago

Question

★★★★★
Compute this exercise In 1626 the Dutch bought the island of Manhattan from Native Americans for approximately $24 worth of trinkets. Assuming an interest rate of 2.75%. (a) what would be the present...

Answered: 1 week ago

Question

★★★★★
In which part of the human body does blood circulate and due to what reason can a heart attack cause death?

Answered: 1 week ago

Question

★★★★★
Throw light on the historical sites of America, mention the kings of America's ancient history.

Answered: 1 week ago

Question

★★★★★
Question: In Java, what is the purpose of the transient keyword when applied to data members of a class? A) To indicate that a variable is non-primitive B) To prevent serialization of certain fields...

Answered: 1 week ago

Question

★★★★★
What lessons in OD contracting does this case represent?

Answered: 1 week ago

Question

★★★★★
Does the code suggest how long data is kept and who has access?

Answered: 1 week ago

Question

★★★★★
Does the policy and code of conduct state who will have to comply with it?

Answered: 1 week ago

Previous Question Next Question