Question: An expected return from a portfolio can be calculated more accurately than the expected return from any of the securities in the portfolio. will lie

An expected return from a portfolio

can be calculated more accurately than the expected return from any of the securities in the portfolio.

will lie somewhere between the highest and lowest expected returns from securities in the portfolio.

cannot be computed if there are fewer than three securities in the portfolio.

will exceed the highest expected return from any of the securities in the portfolio.

will be lower than the expected return from the security in the portfolio with the lowest yield because portfolios have less risk than individual securities.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

Please Answer all three questions Practice Questions 1. A portfolio manager creates the following portfolio: a) What is the expected return of the portfolio? b) If the correlation of returns between...

Q:

Which of the following statements is incorrect? The expected return on a portfolio is independent of the unsystematic risks of the individual securities held in the portfolio. The expected return on...

Q:

1 . If a portfolio has a positive weight for each asset, can the expected return on the portfolio be greater than the return on the asset in the portfolio that has the highest return? Can the...

Q:

A portfolio is consisting of two stocks has the following parameters: A B Standard Deviation 25% 5% Proportion of Portfolio 20% 80% Variance of Portfolio comprising of A and B 50% Calculate the...

Q:

If a portfolio has a positive weight for each asset, can the expected return on the portfolio be greater than the return on the asset in the portfolio that has the highest return? Can the expected...

Q:

Q. 2. Risk free return is at 5% and expected return of market portfolio is 16%. Find out the expected returns of the securities with a beta of (a) 1.25 (b) .8 and (c) 1? Q. 3. Current dividend per...

Q:

Practice Questions 1. A portfolio manager creates the following portfolio: a) What is the expected return of the portfolio? b) If the correlation of returns between the two securities is 0.40 , what...

Q:

An expected return from a portfolio (Select the best choice below.) O A. will exceed the highest expected return from any of the securities in the portfolio. B. cannot be computed if there are fewer...

Q:

An expected return from a portfolio will exceed the highest expected return from any of the securities in the portfolio. will be lower than the expected return from the security in the portfolio with...

Q:

Select the best choice below. An expected return from a portfolio will lie somewhere between the highest and lowest expected returns from securities in the portfolio. will be lower than the expected...

Q:

North Wind Aviation received its charter during January authorizing the following capital stock: Preferred stock: 8 percent, par $ 10, authorized 20,000 shares. Common stock: par $ 1, authorized...

Q:

A square is 1.0 m on a side. Point charges of +4.0 micro C are placed in two diagonally opposite corners. In the other two corners are placed charges of +3.0 micro C and -3.0 micro C. What is the...

Q:

Exercise 15-56 Earnings per Share, Price-Earnings Ratio Refer to the information for Rebert, Inc., above. Also, assume that the market price per share for Rebert is $51.50. Required: 1. Compute the...

Q:

2023 1040 form 1.Phillip and Claire are married and file a joint return. Phillip is self-employed as a real estate agent, and Claire is a flight attendant. Phillip and Claire have three dependent...