Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You have the following data: standard deviation of return on a stock fund (in percent): 34.6% standard deviation of return on a bond fund (in

You have the following data:

  • standard deviation of return on a stock fund (in percent): 34.6%
  • standard deviation of return on a bond fund (in percent): 7.3%
  • correlation between the returns on the stock and bond fund (decimal value): 0.44
  • proportion of the portfolio invested in the stock fund: 0.79

Calculate the standard deviation of return on the portfolio containing this mix of the stock and bond funds.

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

Quantum Economics And Finance

Authors: David Orrell

3rd Edition

1916081630, 978-1916081635

More Books

Students also viewed these Finance questions

Question

3. Identify challenges to good listening and their remedies

Answered: 1 week ago

Question

4. Identify ethical factors in the listening process

Answered: 1 week ago