b) Using information in above ^ and the information that you put 70% of your portfolio in the stock fund and the remaining 30% in the bond fund, compute the standard deviation of your portfolio. Give your answer as a DECIMAL and to four decimal places.

You forecast there are three potential scenarios for the economy: a bull, flat, and bear market. You also estimate the returns for a stock and bond mutual fund as follows: Economic Stock Bond Probability Scenario Fund Fund of Scenario Recession -18% 6% 30% Flat 8% 4% 45% Boom 20% -8% 25% Using this information, you find for the stock fund: E(rs)=3.2% and os=0.1469, and for the bond fund: E[red=1.6% and Op=0.0561. The correlation coefficient between the stock and bond fund is -0.7659. Compute the covariance between the stock and bond fund. Give your answer as a DECIMAL and to four decimal places