You have decided to invest 40% of your wealth in Apple, which has an expected return of 15% and a standard deviation of 15% , and 60 % of your wealth in Alphabet, which has an expected return of 9% and a standard deviation of 14% a. What is the expected return of your portfolio? b. If the correlation between Apple and Alphabet is 0.5, what is the volatility of your portfolio? c. If you wanted an expected return of 13 %, what percentage should you invest in Apple? d. Based on your percentages in part c, what would the volatility of this portfolio be? 1. 2. Explain the difference between Beta and the correlation. Do they provide the same information? Can both be negative? 3. On the CAPM, explain: a. CAL vs CML b. SML vs CML i. Briefly explain them ii. Explain the relationship each one has between risk and expected return. Do they use the same measure of risk? What is the main application of each one Overpricing and underpricing under the SML c. 4. Explain the difference between systematic risk and unsystematic risk. a. What tools do you use to measure the amount of systematic and unsystematic risk in your investment? b. Explain the coefficient of determination (R2)