Question: The following data is given about stocks A, B, and C. You have a portfolio with an expected return of 15%. What is the standard

The following data is given about stocks A, B, and C. You have a portfolio with an expected return of 15%. What is the standard deviation of the portfolio if 30% of the total investment is in Stock C?

	return	risk	return	correlation a,b,c
stock	E(R)	variance(r)	A	B	C
A	25%	50%	1.00	0.40	-0.20
B	15%	40%	0.40	1.0	-0.50
C	5%	30%	-0.20	-0.5	1.00

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Step 1 : Use the price series for the company to calculate monthly returns. Note that 61 months of price data will generate 60 months of returns. Similarly, use the ECU series to calculate the...

1. Over the next year, you believe that the stock market may boom with a 30% probability, stay on a normal course with a 40% probability, or go bust with a 30% probability. Suppose that the excess...

PLEASE DONT SEND ME EXCEL SHEET SCREENSHOT I AM A BEGINNER AND I NEED HAND WRITTEN ANSWERS WITH ALL FORMULA PUTTING METHOD STEP BY STEP. NO NEED OF EXCEL SHEET ANSWER ONLY HAND WRITTEN The following...

5. The following data is given about stocks A, B, and C. You have a portfolio with an expected return of 15%. What is the standard deviation of the portfolio if 30% of the total investment is in...

5. The following data is given about stocks A, B, and C. You have a portfolio with an expected return of 14%. What is the standard deviation of the portfolio if 40% of the total investment is in...

6. The correlation coefficient for assets A and B is.15. Other statistics are as follows: expected return 15% 9% standard deviation 32% 23% An investor forms a portfolio by investing 60% of his money...

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that...

Assume you are constructing the efficient portfolio frontier with three risky stocks A, B, and C as follows. Stock A Expected return Standard deviation 10% 15% 20% 30% 20% 30% B A B 1 0.3 Correlation...

am Part I Saved A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money...

Assume that f(x) and g(x) are differentiable functions about which we know very little. In fact, assume that all we know about these functions is the following table of data: The values of functions...

(a) For Hydrogen atom, Bohrs approximation to the energy ( En= -Z^2/n^2 13.6 ev) gives results close to the experimental results. If the absorption spectrum of the H-atom shows that the electron is...

Treasury stock a. is a class of stock permitted by specific authority of the articles of incorporation. b. c. d. has no voting rights. has preemptive rights. is entitled to dividends

foord member t: I don't trust the cloud, plain and simple. We're putting our data on their hardware, but how do we know their hardware is safe? How do we know their services will be available 24 like...