According to the information given above answer the following questions: What is the portfolios expected return? What
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Question:
According to the information given above answer the following questions:
- What is the portfolio’s expected return?
- What is the variance of the portfolio and standard deviation?
- If you have to choose only one type of securities (stock A, B, C or D) which one will you choose and why? To answer this question, you need to calculate the expected return for each stock and the standard deviation, and compare their values.
- What is the expected return and variance of a portfolio invested 25% each in A, B, C and D? Will the resulting portfolio structure bring you a higher expected return?
- How should you change the shares of securities A, B, C and D in your portfolio in order to minimize risk and maximize expected returns? Explain your answers.
* You should describe each step in detail and provide intermediate calculations. Add tables from Excel if necessary.
*Write your answers after each question.
* Be careful when rounding. Leave two decimal places
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