Question: What is the standard deviation? Application: Mutual Fund Return Let XA and X, be the returns of stocks A and B. E[X] = 10 (%)

What is the standard deviation?

Application: Mutual Fund Return Let XA and X, be the returns of stocks A and B. E[X] = 10 (%) and Var[X2] = 9 (%2) (Stdev[X2]= 3 %) E[X3] = 20 (%) and Var[X2] = 25 (%2) (Stdev[X2]= 5 %) For now, assume returns are independent. (2) What is the standard deviation of the return, Stdev[R]? Var[R] = Var[0.5X+ 0.5XB]= (0.5). Vor(Xa) +(655. Vorlxg). Stdev[R]= What hannene if X and Y are not independent? 25:36 / 38:12 20 000 F DOO F 15 # 3 2 $ 4 % 5 & 7 6 8 9 0

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

N 1 Compute the interest and taxable income of following TIPS 10-year note at the end of the first 6 months since issuance. Terms of TIPS 10-year note are: 1) Value at issuance (par amount) = $1,000;...

1 Assume the following information for stocks A and B: Stock A: Expected Return = 10%, Standard Deviation of Returns 30%; Stock B: Expected Return = 15%, Standard Deviation of Returns 25%;...

Hypothesis Testing of Population Variance Homework Problems 1) The standard deviation of daily returns of a stock's price is used as a measure of the risk of that stock. Suppose that in a sample of...

help mi with my questions 21. There are three assets, A, B and C, where A is the market portfolio and C is the risk-free asset. The return on the market has a mean of 12% and a standard deviation of...

ITEM #1 LEARNING FROM THE HEADLINES True to the Learning from the Headlines approach of this course, watch the Part Three Intro Video after you read the short article the video highlights. Notice...

Hi, I have an Assignment for my Finance Subject. I have attached the necessary documentation here for you to view including the Lecture slides of all the Topics covered for this assignment. Please...

I need help to answer these questions below that are based on the case "Larry Puglia and the T. Rowe Price Blue Chip Growth Fund" 1. How well has the Blue Chip Growth Fund performed in recent years?...

I need your help with this: Can you please quote from the attached chapters / resource if possible? Corporations often use different costs of capital for different operating divisions. Using an...

Could anybody check my work please? If i got wrong, please let know and please help me to correct it! Thank you so much! > Question 1 6 pts Consider the following table: Stock Fund Bond Fund Scenario...

In the "Portfolio Excel Template" accompanying this assignment you have data about 5 Vanguard mutual funds during the 19 years from 2000 through 2018: 1. REIT Index Fund (Real Estate) 2. Total Stock...

Below are the possible percentage returns for stocks A and B for different future states, along with the probabilities of those states occurring. You hold a portfolio consisting of $50,000 invested...

Terry Kunkle and VanBuren High hosted a Christmas party in Berkeley County, South Carolina. Guests had drinks and hors doeuvres at a residence and adjourned to dinner in a barn across a public road....

10. A good sampling plan should have a low degree of discrimination

5. Develop a scenario comparing two PH programs and involving the use of a CBA.

(Appendices) PREPARATION OF MERCHANDISING FINANCIAL STATEMENTS. Jay Coat Company has prepared the following unadjusted trial balance as of December Ble Ox2: LO9 The following data are also available:...

(Appendices) EFFECTS OF DISCOUNTS ON SALES AND PURCHASES. Helmkamp Products sells golf clubs and accessories to pro shops. During 19x5, Helmkamp purchased merchandise with a list price of $628,500 on...

(Appendices) TERMS OF SHIPMENT AND ENDING INVENTORY. On December 31, Archive Products had two shipments of merchandise in transit from different suppliers. The first shipment, which arrived on...