Question 20 points You are presented with a choice between two risky funds summarised in the table below: Expected Return Standard Deviation Stocks 23% 28% Bond 8% 12% RE 6% The correlation coefficient base the stocks and one is 0.13 2.1 Calculate the expected rate of return and standard deviation of the minimum variance portfolio identified above. 7107 2.2 What is the covariance between the stock and the bond? 3/ 23 Consider the table below Beta Forecasted Return 15% Standard Deviation 36% ABC Traders 0.8 Market Risk free 1496 5% 16% 1.0 According to the assumptions of the CAPM, what happens to the price of ABC shares to restore equilibrium? 17 Your answer BE P3 acer