Question: please show all working out 1. Suppose you are given the following data. State Probability Market Return Security Return 1 0.1 -0.15 -0.30 2 0.3

please show all working out
1. Suppose you are given the following data. State Probability Market Return Security Return 1 0.1 -0.15 -0.30 2 0.3 0.05 0.00 3 0.4 0.15 0.20 4 0.2 0.20 0.50 (1) Compute the expected market return and the expected return on the security. (2) Compute the variances of the returns on the market and on the security. (3) Compute the covariance and the correlation coefficient between the market and the security. (4) Find expressions for the expected return and the variance of the return on a portfolio consisting of the market and the security
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
