Risk and Return: DIVERSIFICATION

Here are the percentage returns on two stocks. Dig ital Executive Month Cheese Fruit January 1 5 8 7 8 February 4 2 March 5 3 April 7 1 5 May 5 1 June 3 5 July 3 5 August 9 3 a-1. Calculate the monthly variance and standard deviation of each stock. (Do not round lnterrnedlate calculations. Round your answers to 1 decimal places.) numbness m Standard deviation% : a-2. Which stock is the riskier if held on its own? 0 Digital Cheese 0 Executive Fruit b. Now calculate the variance and standard deviation of the returns on a portfolio that invests an equal amount each month in the two stocks. (Do not round Intermediate calculations. Round your answers to 1 decimal places.) Standard deviation %