Question: state probability Return on RETURN A ON B POOR 35% -0.09 -0.1 NORMAL 15% 0.18 0.11 GOOD 50% 0.2 0.25 beta a 1.5 beta b
state probability Return on RETURN A ON B POOR 35% -0.09 -0.1 NORMAL 15% 0.18 0.11 GOOD 50% 0.2 0.25 beta a 1.5 beta b 1.4 weight a is 55% what is the return of stock a what is the return of stock b? what is the standard deviation of a? what is the standard deviation of b? what is the covariance what is the return of a portfolio what is the standard deviation of the portfolio what is the beta of the portfolio
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