You have a portfolio with a standard deviation of

30 %30%

and an expected return of

17 %17%.

You are considering adding one of the two stocks in the following table. If after adding the stock you will have

20 %20%

of your money in the new stock and

80 %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	1616 %	2121 %	0.20.2
Stock B	1616 %	1818 %	0.70.7

Standard deviation of the portfolio with stock A is

25.18 %.

(Round to two decimal places.)Standard deviation of the portfolio with stock B is

26.64 %.

(Round to two decimal places.)