Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You're crafting a portfolio of two stocks. You have 70% of your money in the first stock and the rest of your money the second

You're crafting a portfolio of two stocks. You have 70% of your money in the first stock and the rest of your money the second stock. The volatility of the first stock is 35% and the volatility of the second stock is 18%. The returns of the two stocks have a correlation coefficient of -0.2. What is the volatility of the portfolio? Answer in percent, showing one decimal place.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Youre crafting a portfolio of two stocks You have 70 of your money in the first stock and the rest o... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals of Corporate Finance

Authors: Berk, DeMarzo, Harford

2nd edition

132148234, 978-0132148238

More Books

Students also viewed these Finance questions

Question

Outline three of Vivess contributions to psychological thought.

Answered: 1 week ago