You would like to invest in Ford and Apple stock. Ford has an expected return of 5% and a standard deviation of 32%. Apple has an expected return of 10% and a standard deviation of 25%. They have a correlation of 0.20 and a co-variance of 1.60%. If you put 50% of your wealth in each asset, what will be the Sharpe Ratio of your portfolio?

In the previous question you put 50% in Ford and 50% in Apple stock. Now, imagine you did a Markowitz analysis and found that the optimal weights are 14% Ford and 86% Apple. If you invest according to these weights, what do you expect will happen to the Sharpe Ratio of your portfolio?

Not enough information to tell

The Sharpe Ratio won't change

The Sharpe Ratio will be higher

The Sharpe Ratio will be lower

It depends on the risk free rate

Please show formulas and steps, So I can learn Thanks!