Question: Question 1 Answer the following questions using the data in the table below: Risk free Rate 3% Expected Return Risk Giants 14% 20% Colts 11%

Question 1

Answer the following questions using the data in the table below:

Risk free Rate 3% Expected Return Risk

Giants 14% 20%

Colts 11% 15%

Dolphins 8% 9%

  1. Which portfolio above would be considered the market portfolio? Show why

  1. What combination on the capital market line will produce a return of 6%? Comment on this portfolio (weighting); with regards to what it represents and how you would achieve it (construction)

  1. What combination will produce a return of 15%? Comment on this portfolio (weighting); with regards to what it represents and how you would achieve it (construction)

  1. What is the risk (as measured by standard deviation) of the portfolio you calculated in b and c?

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