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your portfolio has 25% of its value invested in Vance Trucking (Vance) and the remainder invested in Charter Oil and Gas (Charter). Vance stock has
your portfolio has 25% of its value invested in Vance Trucking (Vance) and the remainder invested in Charter Oil and Gas (Charter). Vance stock has an expected return of 9%, and volatility (standard deviation) of 30%. Charter stock has an expected return of 6% and volatility (standard deviation) of 18%.
If the correlation between Vance and Charter is -0.5, what is the expected return and standard deviation of your portfolio?
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