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You have a portfolio with a standard deviation of 2 0 % and an expected return of 1 8 % . You are considering adding

You have a portfolio with a standard deviation of 20% and an expected return of 18%. You are considering adding
one of the two stocks in the following table. If after adding the stock you will have 20% of your money in the new
stock and 80% of your money in your existing portfolio, which one should you add?
Standard deviation of the portfolio with stock A is
%.(Round to two decimal places.)
Standard deviation of the portfolio with stock B is
%.(Round to two decimal places.)
Which stock should you add and why? (Select the best choice below.)
A. Add B because the portfolio is less risky when B is added.
B. Add A because the portfolio is less risky when A is added.
C. Add either one because both portfolios are equally risky.
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