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You are looking to invest Rs 500,000. You are told that riskless securities are yielding 6% return per annum and the the market portfolio yields
You are looking to invest Rs 500,000. You are told that riskless securities are yielding 6% return per annum and the the market portfolio yields a return of 11% with a Standard deviation of 15%. what would be the investment strategy in order for our overall investment to have a risk level of 18%? do we need to borrow money to implement this strategy? how much money we should we invest in riskless security and how much should we invest in the market portfolio? what should be the return of this portfolio ?
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