COV-VAR E(r) Stocks Bonds Real Estate Stocks Bonds 12% 0.040 0.0048 0.005 6% 0.0048 0.0064 0.0012...

 

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COV-VAR E(r) Stocks Bonds Real Estate Stocks Bonds 12% 0.040 0.0048 0.005 6% 0.0048 0.0064 0.0012 Real Estate 7% 0.005 0.0012 0.01 (a) Calculate the expected return and standard deviation of a portfolio of Stocks, Bonds, and Real Estate. Assume the portfolio is comprised of all three assets, with 60 percen in Stocks, 35 percent in Bonds, and 5 percent in Real Estate. (b) Compute the Sharpe ratio for the portfolio in part (a). The risk-free interest rate is 4 percent. COV-VAR E(r) Stocks Bonds Real Estate Stocks Bonds 12% 0.040 0.0048 0.005 6% 0.0048 0.0064 0.0012 Real Estate 7% 0.005 0.0012 0.01 (a) Calculate the expected return and standard deviation of a portfolio of Stocks, Bonds, and Real Estate. Assume the portfolio is comprised of all three assets, with 60 percen in Stocks, 35 percent in Bonds, and 5 percent in Real Estate. (b) Compute the Sharpe ratio for the portfolio in part (a). The risk-free interest rate is 4 percent.

Answer rating: 100% (QA)

a To calculate the expected return and standard deviation of the por... View the full answer