Your client has $101,000 invested in stock A. She would like to build a two-stock portfolio by investing another $101,000 in either stock B or C. She wants a portfolio with an expected return of at least 15.5% and as low a risk as possible, but the standard deviation must be no more than 40%. What do you advise her to do, and what will be the portfolio expected return and standard deviation?

	Expected Return	Standard Deviation	Correlation with A
A	17%	48%	1.00
B	14%	39%	0.18
C	14%	39%	0.29

The expected return of the portfolio with stock B is ___%.

The expected return of the portfolio with stock C is ___%

The standard deviation of the portfolio with stock B is ____%

The standard deviation of the portfolio with stock C is ____%

You would advise your client to choose ____ because it will produce the portfolio with lower standard deviation.