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Your portfolio consists of 100 shares of CSH and 60 shares of EJH, which you just bought at $18.74 and $29.08 per share, respectively. a.

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed Your portfolio consists of 100 shares of CSH and 60 shares of EJH, which you just bought at $18.74 and $29.08 per share, respectively. a. What fraction of your portfolio is invested in CSH ? In EJH? b. If CSH increases to $23.21 and EJH decreases to $25.69, what is the return on your portfolio? a. What fraction of your portfolio is invested in CSH ? In EJH ? The fraction invested in CSH is \%. (Round to two decimal places.) Consider the following 6 months of returns for 2 stocks and a portfolio of those 2 stocks: Note: The portfolio is composed of 50% of Stock A and 50% of Stock B. a. What is the expected return and standard deviation of returns for each of the two stocks? b. What is the expected return and standard deviation of returns for the portfolio? c. Is the portfolio more or less risky than the two stocks? Why? a. What is the expected return and standard deviation of returns for each of the two stocks? The expected return of Stock A is %. (Round to one decimal place.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Consider the following 6 months of returns for 2 stocks and a portfolio of those 2 stocks: Note: The portfolio is composed of 50% of Stock A and 50% of Stock B. a. What is the expected return and standard deviation of returns for each of the two stocks? b. What is the expected return and standard deviation of returns for the portfolio? c. Is the portfolio more or less risky than the two stocks? Why? a. What is the expected return and standard deviation of returns for each of the two stocks? The expected return of Stock A is %. (Round to one decimal place.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) You are a risk-averse investor who is considering investing in one of two economies. The expected return and volatility of all stocks in both economies are the same. In the first economy, all stocks move together-in good times all prices rise together, and in bad times they all fall together. In the second economy, stock returns are independent one stock increasing in price has no effect on the prices of other stocks. Which economy would you choose to invest in? Explain. (Select the best choice below.) A. A risk averse investor is indifferent in both cases because he or she faces unpredictable risk. B. A risk averse investor would choose the economy in which stocks move together because the uncertainty is much more predictable, and you have to predict only one thing. C. A risk averse investor would choose the economy in which stock returns are independent because risk can be diversified away in a large portfolio. D. A risk averse investor would prefer the economy in which stock returns are independent because by combining the stocks into a portfolio he or she can get a higher expected return than in the economy in which all stocks move together

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