Question: The table below shows you the expected return and standard deviation of two stocks A and B and the covariance between two stocks. Expected return

The table below shows you the expected return and standard deviation of two stocks A and B and the covariance between two stocks.

Expected return standart dev. of return
stock A 10 % 20 %
stock B 25 % 40 %
covariance (A,B) -0,0500

a) Compute the correlation coefficient between two stocks

b) Compute expected return and standard deviation of a portfolio composed of %40 of stock A and %60 of stock B.

c) Compute the vaiance of the portfolio (%40 - %60 proportion)

d) Compute the minimum variance portfolio

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