Stock Expected Return Beta Firm Specific Standard Deviation The market index has a standard deviation of 20%

Question:

Stock Expected Return Beta Firm Specific Standard Deviation

The market index has a standard deviation of 20% and the risk free rate is 7%.
(a) What are the Standard deviations of stocks of Acme and Bundu?
(b) Suppose we were to construct a portfolio with proportions:
Stock Acme .......0.30Stock Bundu ......0.45T-bills ........ 0.25
Compute the expected return, standard deviation, beta, and nonsystematic standard deviation of theportfolio.

Stocks
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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...