Question: Use the data in the table [shown below] to calculate expected return, variance and standard deviation of the rate of return on the portfolio E[Rbonds]

  1. Use the data in the table [shown below] to calculate
    1. expected return,
    2. variance and
    3. standard deviation of the rate of return on the portfolio
E[Rbonds]ƠbondsE[Rstocks]ƠstocksΡ [correlation coeff]
5.00%9.00%11.00%21.00%0.33

  • Portfolio composition: 35% invested in stocks and the remainder in bonds

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