The estimated volatility of a domestic asset is d 15 percent (annualized standard deviation of returns) A foreign asset has a volatility of f 18 percent, and a correlation of p 0 5 with the domestic asset What is the volatility of a portfolio invested 80 percent in the domestic asset and 20 percent...

The domestic and foreign assets have annualized standard devi ...

The estimated volatility of a domestic asset is d = 15 percent (annualized standard deviation of returns).

Question:

The estimated volatility of a domestic asset is σd = 15 percent (annualized standard deviation of returns). A foreign asset has a volatility of σf = 18 percent, and a correlation of p = 0.5 with the domestic asset. What is the volatility of a invested 80 percent in the domestic asset and 20 percent in the foreign asset?
Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...