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You have done your research for the following investments and your friend has provided their expectations for the markets for next year. Probability of State
You have done your research for the following investments and your friend has provided their expectations for the markets for next year. Probability of State of State of Stock Stock Economy Economy B TSX Boom .30 30% -9% 18% Normal .40 16% 12% 10% Recession .30 -10% 20% -10% * Remember to show all of your work * o. You have $10,000 to invest and would like to create a portfolio that has an expected return of 15 percent. How much will you need to invest in stock A and stock B and what is the risk that is associated with this portfolio? (6 marks)
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