a. How many variance terms and how many different covariance terms do you need to calculate the
Fantastic news! We've Found the answer you've been seeking!
Question:
a. How many variance terms and how many different covariance terms do you need to calculate the risk of a 100-share portfolio?
b. Suppose all stocks had a standard deviation of 30% and a correlation with each other of .4. What is the standard deviation of the returns on a portfolio that has equal holdings in 50 stocks?
c. What is the standard deviation of a fully diversified portfolio of such stocks?
Related Book For
Personal Finance Turning Money into Wealth
ISBN: 978-0133856439
7th edition
Authors: Arthur J. Keown
Posted Date: