Question
You are interest in investing in two firms in Wisconsin, Harley Davidson (HOG) and Alliant Energy (LNT). LNT has an expected return of 8% and
You are interest in investing in two firms in Wisconsin, Harley Davidson (HOG) and Alliant Energy (LNT).
LNT has an expected return of 8% and a volatility of 13%.
HOG has an expected return of 17% and a volatility of 27%.
The correlation between the two is -0.52.
Risk-free rate is 1.8.
Suppose you create a portfolio by investing 30% in LNT and 70% in HOG. What would be the expected return of this portfolio?
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Financial Management Theory And Practice
Authors: Eugene F. Brigham, Michael C. Ehrhardt
10th Edition
0030329922, 9780030329920
