Use the stock returns given in the following table under different economic conditions. In you invest %30 of your wealth to Stock A, %20 of your wealth to Stock B, %25 of your wealth to Stock C and %25 of your wealth to Stock D.

1. Calculate the expected rate of return and standard deviation of the portfolio.
2. If you were to invest with equal weights to every single stock. Calculate the expected rate of return and standard deviation of the portfolio. Compare your findings with question A. What may be the main cause of difference between these two porfolios.
3. To obtain a zero standard deviation on a portfolio of your construction with Stock A and D. Calculate the weights that should be assigned to these Stocks.

Hint Wa + Wd = 1

Econ. Condition	A	B	C	D
Boom p=.30	110	10	35	-35
Good p=.20	60	30	35	-15
Normal p=.35	25	60	35	60
Bad p=.15	0	90	35	140

I would be glad if you explain it step by step in your own words in detail. especially with how the transactions are and the calculations of the transactions, thank you in advance.