Investment Advisors are working with a client on determining an optimal portfolio of bond funds. The...
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Investment Advisors are working with a client on determining an optimal portfolio of bond funds. The firm suggests six different funds, each with different expected returns and risk measures (based on historical data in the table): Expected Risk Bond Fund Return Measure 1 Ohio National Bond 6.11% 2.31 2 PIMCO Global Bond Unhedged 7.61% 3.52 Federated High Income Bond 5.29% 4.51 4 Morgan Stanley Fixed Income 2.79% 1.97 5 PIMCO Real Return 7.37% 3.02 6 PIMCO Total Return 5.65% 2.58 The client wants to invest $100,000. Suppose the client wants to minimize risk and achieve a return of at least 6% (with no additional limitations or requirements). Find the optimal investment strategy. The solution suggests that the funds should be allocated to funds 1 and 5 funds 1,4,5,6 funds 1,2,4,5,6 funds 1,3,4,5,6 funds 1 and 4 Investment Advisors are working with a client on determining an optimal portfolio of bond funds. The firm suggests six different funds, each with different expected returns and risk measures (based on historical data in the table): Expected Risk Bond Fund Return Measure 1 Ohio National Bond 6.11% 2.31 2 PIMCO Global Bond Unhedged 7.61% 3.52 Federated High Income Bond 5.29% 4.51 4 Morgan Stanley Fixed Income 2.79% 1.97 5 PIMCO Real Return 7.37% 3.02 6 PIMCO Total Return 5.65% 2.58 The client wants to invest $100,000. Suppose the client wants to minimize risk and achieve a return of at least 6% (with no additional limitations or requirements). Find the optimal investment strategy. The solution suggests that the funds should be allocated to funds 1 and 5 funds 1,4,5,6 funds 1,2,4,5,6 funds 1,3,4,5,6 funds 1 and 4
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