You decide to invest in a portfolio consisting of 15 percent Stock X, 36 percent Stock Y, and the remainder in Stock Z. Based on the following information, what is the standard deviation of your portfolio?

State of Economy Probability of State of Economy Return if State Occurs
Stock X Stock Y Stock Z
Normal 0.77   9.00% 2.40% 11.40%
Boom 0.23 16.30% 24.30% 15.80%

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To calculate the standard deviation of the portfolio we first need to calculate the expected return ... View the full answer