Question
You want to allocate your money between the risk free asset (0.011), a fixed income fund ( E(B)=0.084, Volatility(B)=0.14), and a diversified stock fund (
You want to allocate your money between the risk free asset (0.011), a fixed income fund ( E(B)=0.084, Volatility(B)=0.14), and a diversified stock fund ( E(S)=0.147, Volatility(S)=0.16). The correlation between the two risky funds is 0.44. When creating the optimal risky portfolio, how much weight in decimals should you invest in the diversified stock fund?
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Banking And Finance
Authors: Brian Duignan
1st Edition
1615308946, 978-1615308941
