Question: Question 5. (15 points) Using the CAPM approach to building a portfolio, calculate the percentage return and its standard deviation for the following portfolios.

Question 5. (15 points) Using the CAPM approach to building a portfolio,

Question 5. (15 points) Using the CAPM approach to building a portfolio, calculate the percentage return and its standard deviation for the following portfolios. You have a total of $100 to invest. Portfolio one includes 40% ($40) in the money market fund, and 60% ($60) in the stock index fund. Portfolio two includes 130 % ($130) in the stock fund using leverage (borrowed money of 30% or $30 at the risk-free rate). Investment Return Risk Stock fund 8% 21% Money market fund 2.5%

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