Question: You want to create a portfolio which will include the stocks of CIBC and Suncor. You have gathered the following information about these two companies

You want to create a portfolio which will include the stocks of CIBC and Suncor.

You have gathered the following information about these two companies Expected Return Standard Deviation Suncor 19.04% 14.30% CIBC 5.41% 1.00% Correlation 0.3 You have decided to invest $70,000 in CIBC and $30,000 in Suncor. What is the expected rate of return and standard deviation of your portfolio?

Note: You may want to increase the number of decimals on your calculator. The maximum is 8 decimals. Here is a quick reminder of how to do so: 2nd, Format, 8, Enter. Format is the middle button in the last row (grey button) and Enter is just next to CPT.

please show your work

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!

You want to create a portfolio which will include the stocks of CIBC and Suncor. You have gathered the following information about these two companies Expected Return Standard Deviation Suncor 19.04%...

You are a manager of Third Capital mutual fund. You can only invest in 2 stocks and 1 T-bill because of restrictions in your company. Risk-free rate is 5%. You have information about two stocks...

You want to create a portfolio which will include the stocks of TDA and Philips. You have gathered the following information about these two companies Expected Return Standard Deviation Philips...

Can you complete the below questions I need the answers in an Excel spreadsheet I need it by this time tomorrow (24 hours)? The PDF attachment is for one of the questions on the Word document (the...

You have been assigned to construct a portfolio comprising two risky assets (Portfolios A & B) while considering your clients risk tolerance. The attached spread sheet shows historical monthly...

1.Which of the following portfolio cannot lie on the efficient frontier as described by Markowitz? Portfolio Expected Return Standard Deviation W 9% 21% X 5% 7% Y 15% 36% Z 12% 15% ____ A)Portfolio W...

You decide to invest your savings in a combination of (i) the risk-free asset (denoted RFR), (ii) a stock market index fund (denoted SF), and (iii) a corporate bond fund (BF). The annual returns of...

Based on the following information: a . Calculate the expected return for each of the stocks. ( Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places,...

You own a portfolio equally invested in stock X and stock Y. The market is expected to generate returns of 15% and the risk-free rate is 6% (a) Use the Capital Asset Pricing Model (CAPM) to calculate...

Discuss whether or not each of the following activities is a data mining task. (a) Dividing the customers of a company according to their gender. (b) Dividing the customers of a company according to...

Explain the importance of Dalton's law of partial pressure, and Provide a situation wherein it is applied

Assessment rate is 70%, Market value is $170,000, what is the Assessed value

Draw a class diagram and its relationship based on the following statements. You can use any UML tool/software to represent your class diagram. Do NOT copy and paste your diagram, use the attachment...