Question
Your job as financial planner is to create the complete portfolio for the client, which meets the expected return and standard deviation targets of your
Your job as financial planner is to create the complete portfolio for the client, which meets the expected return and standard deviation targets of your client by mixing the optimal risky portfolio and the risk-free asset. Your client expects a 5.29% expected return and a 5.58% standard deviation on the complete portfolio.
(4-1) Calculate the weight of the optimal risky portfolio in the complete portfolio.
(4-2) Calculate the weight of the risk-free asset in the complete portfolio.
(4.3) Calculate the weight of the stock fund in the complete portfolio.
(4.4) Calculate the weight of the bond fund in the complete portfolio.
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