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You own $1,000 worth of shares of Ford (sigma = 20%) and you have $1,000 to buy shares of one of the following firms. Which
"You own $1,000 worth of shares of Ford (sigma = 20%) and you have $1,000 to buy shares of one of the following firms. Which one would you buy?"
E(R ) | Sigma | Correlation with Ford | |
GM | 10% | 10% | 0.8 |
IBM | 10% | 15% | 0.3 |
ATT | 10% | 20% | -0.1 |
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