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Your eccentric Aunt Claudia has left you $50,000 in BP shares plus $50,000 cash. Unfortunately, her will requires that the BP stock not be sold
Your eccentric Aunt Claudia has left you $50,000 in BP shares plus $50,000 cash. Unfortunately, her will requires that the BP stock not be sold for one year and the $50,000 cash must be entirely invested in one of the stocks shown below.
BHP Billiton | Siemens | Nestl | LVMH | Toronto Dominion Bank | Samsung | BP | ||||||||
BHP Billiton | 1.00 | 0.25 | 0.05 | 0.28 | 0.46 | 0.38 | 0.35 | |||||||
Siemens | 1.00 | 0.37 | 0.17 | 0.13 | 0.30 | 0.26 | ||||||||
Nestl | 1.00 | 0.18 | 0.19 | 0.11 | 0.19 | |||||||||
LVMH | 1.00 | 0.13 | 0.27 | 0.07 | ||||||||||
Toronto Dominion Bank | 1.00 | 0.20 | 0.21 | |||||||||||
Samsung | 1.00 | 0.22 | ||||||||||||
BP | 1.00 | |||||||||||||
Standard deviation (%) | 32.10 | 24.90 | 11.09 | 18.40 | 21.70 | 27.70 | 24.00 |
A. Calculate the portfolio variance for seven different portfolios. (Use decimals, not percents, in your calculations. Do not round intermediate calculations. Enter your answers as a decimal rounded to 5 places.)
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