Question: Implied Correlation i . a portfolio has 1 0 0 equally weighted components; ii . each component has a stdev of 4 0 % ;

Implied Correlation
i. a portfolio has 100 equally weighted components;
ii. each component has a stdev of 40%;
iii. pair-wise correlation is 0.4.
a what is the portfolio stdev?
b If component has iv of 30% and portfolio iv is 20%, what is the implied correlation?

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