Question
You have a portfolio with a standard deviation of 26% and an expected return of 18%. You are considering adding one of the two stocks
You have a portfolio with a standard deviation of
26%
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
30%
of your money in the new stock and
70%
of your money in your existing portfolio, which one should you add?
Expected
Return
| Standard
Deviation
| Correlation with
Your Portfolio's Returns
| |
Stock A
| 14%
| 24%
| 0.3
|
Stock B
| 14%
| 16%
| 0.5
|
Question content area bottom
Part 1
Standard deviation of the portfolio with stock A is
enter your response here
part2
standard deviation of the portfolio with stock A is
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