Question: please help Consider historical data showing that the average annual rate of return on the S&P 500 portfolio over the past 85 years has averaged
Consider historical data showing that the average annual rate of return on the S\&P 500 portfolio over the past 85 years has averaged roughly 8% more than the Treasury bill return and that the S\&P 500 standard deviation has been about 26% per year. Assume these values are representative of investors' expectations for future performance and that the current T-bill rate is 5%. Calculate the expected return and variance of portfolios invested in T-bills and the S\&P 500 index with weights as shown below. (Enter your onswers as decimals rounded to 4 places. Leave no cells blonk - be certoin to enter " 0 " wherever required.)
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