Question: Please only answer the question(b) Consider the following information about two stocks, Alfa and Omega: Omega 4% 7% The correlation between the two securities returns

Please only answer the question(b)

Consider the following information about two stocks, Alfa and Omega: Omega 4% 7% The correlation between the two securities returns is 0.25 [3) Calculate the expected return and standard deviation of the following four portfolios: (8 marks) (b) Explain why, under the CAPM framework, the standard deviation of an asset's returns is not a good measure of risk. (4 marks)

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