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Your portfolio is invested 25 percent each in Stocks A and C, and 50 percent in Stock B. What is the standard deviation of your
Your portfolio is invested 25 percent each in Stocks A and C, and 50 percent in Stock B. What is the standard deviation of your portfolio given the following information?
State of Economy | Probability of State of Economy | Rate of Return if State Occurs | ||||||||
Stock A | Stock B | Stock C | ||||||||
Boom | .07 | .28 | .14 | .11 | ||||||
Good | .55 | .19 | .12 | .09 | ||||||
Poor | .36 | .21 | .07 | .06 | ||||||
Bust | .02 | .65 | .03 | .03 |
A) | 6.52 percent | |
B) 10.89 percent | ||
C) 7.39 percent | ||
D) 9.64 percent | ||
E) 12.72 percent |
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