Question: Question 21 (8 points) CRM Inc is exploring the risk of different portfolio allocation between two stocks. Complete the following table. Case 1 Case 2

Question 21 (8 points) CRM Inc is exploring the risk of different portfolio allocation between two stocks. Complete the following table. Case 1 Case 2 Weight in stock 1 ? 15% Weight in stock 2 25% ? Standard deviation of 15% 2% stock 1 Standard deviation of 3% 10% stock 2 Covariance between ? stocks 1 and 2 Correlation between stocks 1 and -.20 .40 2 Portfolio variance Portfolio standard ? ? deviation

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