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You have a portfolio with a standard deviation of 24 % and an expected return of 18 % You are considering adding one of the

You have a portfolio with a standard deviation of

24 %

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?

Expected

Return

Standard

Deviation

Correlation with

Your Portfolio's Returns

Stock A

13

24

0.2

Stock B

13

18

0.7

1. Standard deviation of the portfolio with stock A is?

(Round to two decimal places.)

2. Standard deviation of the portfolio with stock B is?

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