Question
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 BillitonBPSiemensNestlSonySanofiAgricultural BankBHP Billiton1.000.320.050.350.530.450.42BP 1.000.320.160.150.360.08Siemens 1.000.110.120.040.12Nestl 1.000.310.490.06Sony 1.000.200.28Sanofi 1.000.29Agricultural Bank 1.00Standard deviation (%)21.6028.909.0316.0028.7029.1026.80a. 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.)b. What is the safest attainable portfolio under these restrictions?
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Investments
Authors: Zvi Bodie, Alex Kane, Alan J. Marcus
8th Edition
0077261453, 978-0077261450
