Question
Your portfolio is invested 30 percent each in stocks A and C, and 40 percent in stock B. What is the standard deviation of your
Your portfolio is invested 30 percent each in stocks A and C, and 40 percent in stock B.
What is the standard deviation of your portfolio given the following information?
State ofEconomy Probability of Rate of Return if State Occurs
State of Economy A B C
Boom .25 .25 .25 .45
Good .25 .10 .13 .11
Poor .25 .03 0.05 .05
Bust .25 -.04 -0.09 -0.09
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Practical Financial Management
Authors: William R. Lasher
8th edition
1305637542, 978-1305887237, 1305887239, 978-1305637542
