Betsy Moore wants to invest in the stocks of companies A, B, C, and D, whose annual

Question:

Betsy Moore wants to invest in the stocks of companies A, B, C, and D, whose annual returns for the past thirteen years are as follows:

a. Suppose that Betsy is completely risk-averse. What percentage of her portfolio should be invested in each stock and what would the expected risk and return be on the resulting portfolio?
b. Suppose that Betsy is completely insensitive to risk and wants the maximum possible return. What percentage of her portfolio should be invested in each stock and what would the expected risk and return be on the resulting portfolio?
c. Suppose Betsy has determined that her risk aversion value is r = 0.95. What percentage of her portfolio should be invested in each stock, and what is the expected risk and return on the resultingportfolio?

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... 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...