Question: The risk-free rate, average returns, standard deviations, and betas for three funds and the S&P 500 are given below. Fund A B S&P 500 lp

 The risk-free rate, average returns, standard deviations, and betas for three

The risk-free rate, average returns, standard deviations, and betas for three funds and the S&P 500 are given below. Fund A B S&P 500 lp Avg 13.5% 20.0% 15.5% 12% 5.0% Std Dev 26.5% 30.5% 22.5% 17% Beta 1.20 1.45 1.25 1 If these portfolios are subcomponents that make up part of a well-diversified portfolio, then portfolio is preferred. S&P 500

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