Question: I know the answer is D please just provide the workings for the answer. 2. A portfolio is composed of two stocks, A and B.

I know the answer is D please just provide the workings for the answer.

2. A portfolio is composed of two stocks, A and B. Stock A has a standard deviation of return of 24%, while stock B has a standard deviation of return of 18%. Stock A comprises 60% of the portfolio, while stock B comprises 40% of the portfolio. If the variance of return on the portfolio is 0.0280, the correlation coefficient between the returns on A and B is_ A. .583 B. .225 C..327 D. .100

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!

10.A portfolio is composed of two stocks, A and B. Stock A has a standard deviation of return of 24%, while stock B has a standard deviation of return of 18%. Stock A comprises 60% of the portfolio,...

Please read chapter 5 and answer the questions and see the ( guide to answer number 3) For each case study, you will view the material as the student's teacher, read the information provided and...

One. Given the discussions we had during lecture one, use your understanding and knowledge gained from such lecture and answer the following questions. Kindly submit online, your appropriate answers...

Please read chapter 6 and answer the questions and see the ( guide to answer number 3) For each case study, you will view the material as the student's teacher, read the information provided and...

Portfolio return and standard deviation Personal Finance Problem Jamie Wong is considering building an investment portfolio containing two stocks, Land M. Stock L will represent 75% of the dollar...

PLEASE ANSWER BOTH PARTS: PART A: You've created a portfolio of two stocks with the following investment weights and returns: A B C 1 Stock A Stock B 2 Weights 0.6 0.4 3 4 Year Stock A Stock B 5 1 5%...

38) PLEASE ANSWER BOTH PARTS: PART A: You've created a portfolio of two stocks with the following investment weights and returns: A B C 1 Stock A Stock B 2 Weights 0.6 0.4 3 4 Year Stock A Stock B 5...

P8?3 Risk preferences Sharon Smith, the financial manager for Barnett Corporation, wishes to evaluate three prospective investments: X, Y, and Z. Sharon will evaluate each of these investments to...

Please answer all parts. Thank you Homework: Chapter 08 Homework Save Score: 0 of 1 pt 4 of 10 (2 complete) HW Score: 20%, 2 of 10 pts P8-13 (similar to) A Question Help Portfolio return and standard...

4. Risk and Return [25 Marks] 1) Diversification. Here are the returns on two stocks. Stock N (%) 6 January February -4 March 5 April 13 May 2 June 5 July -5 ECO-20007 (June 2022) Page 5 of 12 a....

Calero Inc. is a publicly-traded firm, with 25 million shares trading at $16/share (book value of equity is $250 million), $300 million in debt outstanding (market and book value), and $50 million as...

You have the following information: Rx - Rf = -0.028097 +0.537420 (Rm - Rf) + ex. OM = 0.58453520; Rm = 0.026841; Rf = 0.027232; (ex) = 0.37107390 What is the predicted excess return of stock X?...

According to numerous studies, what are some effects of corsuming dairy products? Choose all that apply. Incremed tiak of bone fracture incremed oprotive hew tincresed protection tom oiteoporswis...

10) For a bond that pays cash interest (i.e., not a zero coupon bond), YTM is (a) always equal to the coupon rate (b) always equal to the current yield (c) is always less than the coupon rate (d) can...

List the various sources from which job applicants can be drawn, their relative advantages and disadvantages, and the methods for evaluating them. page 206

Analyze an organizations structure and work-flow process, identifying the output, activities, and inputs in the production of a product or service. page 147

Discuss the roles and activities of a companys human resource management function. page 5