Question: Please answer this question please. Thanks! Risk and return answers can be in percentage A researcher provides you with the following information for two risky

Please answer this question please. Thanks! Risk and return answers can

Please answer this question please. Thanks!

Risk and return answers can be in percentage

A researcher provides you with the following information for two risky assets: Securities ABC Ltd XYZ Ltd Expected Return 0.8 0.12 Standard Deviation 0.07 0.09 The correlation between the fund returns is -0.5. Required (a) Given that an individual initially decides to invest 45% of his wealth in ABC Ltd and 55% in XYZ Ltd, calculate the expected return and risk of the individual's portfolio. [6 marks] (b) The portfolio return and risk for the minimum variance portfolio. [6 marks] (c) The Sharpe Ratio of the securities and initial portfolio, assuming a risk free rate of 4%. [3 marks] Page 2 of 3

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