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You have $ 11 comma 400 to invest. You decide to invest $ 23 comma 000 in Google and short sell $ 11 comma 600
You have $ 11 comma 400 to invest. You decide to invest $ 23 comma 000 in Google and short sell $ 11 comma 600 worth of Yahoo! Google's expected return is 13 % with a volatility of 34 % and Yahoo!'s expected return is 11 % with a volatility of 27 %. The stocks have a correlation of 0.89. What is the expected return and volatility of the portfolio?
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