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You manage a risky portfolio with an expected rate of return of 20% and a standard deviation of 29%. The T-bill rate is 5%. Your
You manage a risky portfolio with an expected rate of return of 20% and a standard deviation of 29%. The T-bill rate is 5%. Your risky portfolio includes the following investments in the given proportions: Stock A Stock B Stock C 27% 32% 41% Suppose that your client decides to invest in your portfolio a proportion y of the total investment budget so that the overall portfolio will have an expected rate of return of 17%. a. What is the proportion y? (Round your answer to the nearest whole number.) Proportion y % b. What are your client's investment proportions in your three stocks and the T-bill fund? (Do not round intermediate calculations. Round your answers to 2 decimal place.) T-Bills Investment Proportions 21.70% 35.00% % Stock A Stock B Stock C % c. What is the standard deviation of the rate of return on your client's portfolio? (Do not round intermediate calculations. Round your answer to 2 decimal place.) Standard deviation %
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