Question: undefined 3. (20 points) A portfolio manager is providing recommendations to her clients. Her research department has prepared the following information for her: Portfolio Stock

undefined 3. (20 points) A portfolio manager is providing recommendations to her undefined

3. (20 points) A portfolio manager is providing recommendations to her clients. Her research department has prepared the following information for her: Portfolio Stock X Stock Y Risk-free Forecasted Return 8.0% 12.0% 5.0% std dev 6% 20% 0% (a) Which stock should an investor hold? Explain your answers. (b) Draw the Capital Allocation Line of Stock X and Stock Y in one xy-coordinate system

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