Question
You just construct a portfolio AJ where you invest $1000 in Security A and $4000 in Security J. The portfolio has an expected return of
You just construct a portfolio AJ where you invest $1000 in Security A and $4000 in Security J. The portfolio has an expected return of 0.22 and a variance of 0.0016. Which of the following statements is correct?
1. Portfolio AJ has a CV of 0.07 and is a better investment than portfolio X that has an expected return of 20%.
2. Portfolio AJ has a CV of 0.18 and is a better investment than portfolio P that has a CV of 0.25.
3. Portfolio AJ has a CV of 0.18 and is a better investment than portfolio Y that has a SD of 5%.
4. Portfolio AJ has a CV of 0.25 and is a better investment than portfolio Z that has a SD of 0%.
5. Portfolio AJ has a CV of 0.18 and is a better investment than portfolio F that has a CV of 0.10
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Bond Markets Analysis and Strategies
Authors: Frank J.Fabozzi
9th edition
133796779, 978-0133796773
