Question: Using the table below, plot the opportunity set of risky assets in Excel. Then vary the correlation between stocks and bonds from + 1 to
Using the table below, plot the opportunity set of risky assets in Excel.
Then vary the correlation between stocks and bonds from + 1 to -1 and describe the changes in shape of the efficient frontier as you do so.
Upload the Excel file that contains the table & graph.
Also include in Excel file a description of theefficient frontier's shape as you vary the correlation
Stock Allocation Bond Allocation Return Risk Sharpe Ratio
0% 100% 6.00% 8.00% 0.375
5% 95% 6.20% 7.821% 0.409139927
10% 90% 6.40% 7.713% 0.440815577
15% 85% 6.60% 7.678% 0.468868857
20% 80% 6.80% 7.718% 0.49238663
25% 75% 7.00% 7.830% 0.510840685
30% 70% 7.20% 8.013% 0.524140786
35% 65% 7.40% 8.262% 0.532590474
40% 60% 7.60% 8.570% 0.536774032
45% 55% 7.80% 8.932% 0.537421004
50% 50% 8.00% 9.341% 0.535287728
55% 45% 8.20% 9.791% 0.531075562
60% 40% 8.40% 10.278% 0.525387292
65% 35% 8.60% 10.796% 0.518713117
70% 30% 8.80% 11.341% 0.511435211
75% 25% 9.00% 11.909% 0.503841567
80% 20% 9.20% 12.496% 0.49614291
85% 15% 9.40% 13.102% 0.488489134
90% 10% 9.60% 13.722% 0.480983643
95% 5% 9.80% 14.355% 0.473695101
100% 0% 10.00% 15.000% 0.466666667
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
