Question: 9) A portfolio manager is considering two mutual funds. A stock fund has expected return of 15% and standard deviation of 25%. A bond fund

9) A portfolio manager is considering two mutual funds. A stock fund has expected return of 15% and standard deviation of 25%. A bond fund has expected return of 7% and standard deviation of 12%. The correlation between the fund returns is -0.5.

a. What are the investment proportions in the minimum variance portfolio of the two risky funds? b. What are the minimum variance portfolio mean and standard deviation?

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