Question: Question 2 Suppose that there exist two securities with annual expected returns equal to 3% and 5% and standard deviation of the returns equal to

Question 2 Suppose that there exist two securities with annual expected

Question 2 Suppose that there exist two securities with annual expected returns equal to 3% and 5% and standard deviation of the returns equal to 7% and 10%, respectively. If the correlation coefficient between the returns of these securities is -0.5, what is the expected return and the standard deviation of an equal weighted portfolio consisting of these securities? What is the return of a portfolio consisting of these securities if the weights of the corresponding securities are chosen to minimize the risk of the portfolio? Provide a detailed explanation of every step of your calculations

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