Portfolio return and standard deviation Personal Finance Problem Jamie Wong is considering building an investment portfolio containing two stocks, L and M. Stock L will represent 70% of the dollar value of the portfolio, and stock M will account for the other 30%. The expected returns over the next 6 years, 2015-2020, for each of these stocks are shown in the following table: a. Calculate the expected portfolio return, rp, for each of the 6 years. b. Calculate the expected value of portfolio returns, rp, over the 6-year period. c. Calculate the standard deviation of expected portfolio returns, ., over the 6-year period. d. How would you characterize the correlation of returns of the two stocks L and M? e. Discuss any benefits of diversification achieved by Jamie through creation of the portfolio. Data Table (Click on the icon located on the top-right comer of the data table below in order to copy its contents into a spreadsheet.) Expected return Year 2015 2016 2017 2018 2019 2020 Stock M 23% Stock L 16% 18% 19% 20% 22% 22% 21% 20% 19% 18%