Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You have a three - stock portfolio. Stock A has an expected return of 1 5 percent and a standard deviation of 4 0 percent,

You have a three-stock portfolio. Stock A has an expected return of 15 percent and a standard deviation of 40 percent, Stock B has an expected return of 19 percent and a standard deviation of 45 percent, and Stock C has an expected return of 14 percent and a standard deviation of 45 percent. The correlation between Stocks A and B is .30, between Stocks A and C is .20, and between Stocks B and C is .05. Your portfolio consists of 34 percent Stock A,20 percent Stock B, and 46 percent Stock C. Calculate the expected return and standard deviation of your portfolio. The formula for calculating the variance of a three-stock portfolio is:
(Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)
Answer is not complete.
\table[[,,],[Expected return,15.32,%
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

International Finance

Authors: Keith Pilbeam

4th Edition

0230362893, 978-0230362895

More Books

Students also viewed these Finance questions