Question
You are interest in investing in two firms in Wisconsin, Harley Davidson (HOG) and Alliant Energy (LNT). LNT has an expected return of 7.6% and
You are interest in investing in two firms in Wisconsin, Harley Davidson (HOG) and Alliant Energy (LNT).
LNT has an expected return of 7.6% and a volatility of 12.4%.
HOG has an expected return of 16.5% and a volatility of 20.2%.
The correlation between the two is 0.2.
Risk-free rate is 1.1.
Suppose you create a portfolio composed of 50% LNT and 50% HOG. What is the volatility of this portfolio?
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Financial Management Theory And Practice
Authors: Eugene F. Brigham, Michael C. Ehrhardt
10th Edition
0030329922, 9780030329920
