A portfolio consisted of two risky assets A and B Correlation 0.45 A's Expected Return 7.00%...
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A portfolio consisted of two risky assets A and B Correlation 0.45 A's Expected Return 7.00% B' Expected Return 9.00% o(A) 15.00% (B) Weight A Weight B 20.00% 75.00% 25.00% 1) Please calculate the portfolios expected return and portfolio's standard deviation. 2) If we change the Correlation Coefficient from 0.45 to -1, please recalculate the portfolio's expected return and standa deviation. 3) Please comment on the portfolio's risk after we change the Correlation from 0.45 to -1. What is your observation (less than 50 words) A portfolio consisted of two risky assets A and B Correlation 0.45 A's Expected Return 7.00% B' Expected Return 9.00% o(A) 15.00% (B) Weight A Weight B 20.00% 75.00% 25.00% 1) Please calculate the portfolios expected return and portfolio's standard deviation. 2) If we change the Correlation Coefficient from 0.45 to -1, please recalculate the portfolio's expected return and standa deviation. 3) Please comment on the portfolio's risk after we change the Correlation from 0.45 to -1. What is your observation (less than 50 words)
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Lets calculate the portfolios expected return and standard deviation for both scenarios 1 Original C... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-1119048534
11th Canadian edition Volume 1
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Nicola M. Young, Irene M. Wiecek, Bruce J. McConomy
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