You wish to combine two stocks, Encor and Maestro, into a portfolio with an expected return of

Question:

You wish to combine two Encor and Maestro, into a with an of 16 percent. The of Encor is 2 percent with a standard deviation of 1 percent. The of Maestro is 25 percent with a standard deviation of 10 percent. The correlation between the two is 0.4.
a. What is the composition (weights) of the What is the standard deviation?

Stocks
Stocks or shares are generally equity instruments that provide the largest source of raising funds in any public or private listed company's. The instruments are issued on a stock exchange from where a large number of general public who are willing... Expected Return
The expected return is the profit or loss an investor anticipates on an investment that has known or anticipated rates of return (RoR). It is calculated by multiplying potential outcomes by the chances of them occurring and then totaling these... 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...