Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You have two stocks in your portfolio. The following parameters's values are given to you. Please calculate your portfolio risk. answer as a percentage with

You have two stocks in your portfolio.

The following parameters's values are given to you. Please calculate your portfolio risk. answer as a percentage with two decimals. without the sign (e.g. if your answer is 20.22%, write down 20.22).

(To calculate the portfolio risk, you must calculate the variance first, and then calculate the standard deviation)

Weight of Stock A:45%

Weight of Stock B:55%

Risk of Stock A(sigma):15%

Risk of Stock B(sigma):8.5%

Correlation Coefficient of A&B (rho) :0.3

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

Financial Management Theory and Practice

Authors: Eugene F. Brigham, Michael C. Ehrhardt

16th edition

1337902608, 978-1337902601

More Books

Students also viewed these Finance questions