You own only two stocks in your portfolio but want to add more. When you add a third stock, the total risk of your portfolio declines. When you add a tenth stock to the portfolio, the total risk declines. Adding which stock, the third or the tenth, likely reduced the total risk more? Why?
Answer to relevant QuestionsExplain what we mean when we say that one portfolio dominates another portfolio? Sprint Nextel Corp stock ended the previous year at $23.36 per share. It paid a $2.37 per share dividend last year. It ended last year at $18.89. If you owned 500 shares of Sprint, what was your dollar return and percent ...Assess the risk-return relationship in T-bills (Tables) during each decade since 1950. You have a portfolio with an asset allocation of 35 percent stocks, 55 percent long-term Treasury bonds, and 10 percent T-bills. Use these weights and the returns in Table 9.2 to compute the return of the portfolio in the ...A Treasury bond that you own at the beginning of the year is worth $1,055. During the year, it pays $35 in interest payments and ends the year valued at $1,065. What was your dollar return and percent return?
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