Question: . Use data below to answer the following problems regarding portfolios: Security Expected Return Standard Deviation 1 40% 0.75 2 10% 0.32 Assume that 1,2

. Use data below to answer the following problems regarding portfolios:

Security

Expected Return

Standard Deviation

1

40%

0.75

2

10%

0.32

Assume that 1,2= -0.45.

  1. What is the expected return of your portfolio if your portfolio consists of 40% of Security 1 and 60% of Security 2?
  2. What is the expected variance of your portfolio if your portfolio consists of 40% of Security 1 and 60% of Security 2?
  3. Determine the portfolio weights that would give the minimum standard deviation portfolio.

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