Question: Please show step by step 1. Consider 123 Fund (which is invested in 35% High risk stock and 65% normal bonds). Assume you have the

Please show step by step

Please show step by step 1. Consider 123 Fund (which is invested

1. Consider 123 Fund (which is invested in 35% High risk stock and 65% normal bonds). Assume you have the following historical data of annual returns: Return S.D. Normal Stock 8% 20% Risky Bonds 10% 35% High Risk Stock 14% 40% Normal Bonds 6% 10% Assume High Risk Stocks and Normal Bonds have correlation coefficient of 0. 14 Find the standard deviation of 123. Please use 5 decimal places in your response 2. Consider that the investment fund ABC Fund exists and it is 75% invested in normal stock and 25% risky bonds Assume you have the following historical data of annual returns: Return S.D. Normal Stock 7.6% 20% Risky Bonds 11.5% 35% High Risk Stock 14% 40% Normal Bonds 6% 10% What is the expected return of ABC fund? Please use 5 decimal places in your response

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