Suppose we obtain the following data in dollar terms: The correlation coefficient between the two markets is

Question:

Suppose we obtain the following data in dollar terms:

The correlation coefficient between the two markets is 0.58. Suppose that you invest equally, that is, 50 percent in each of the two markets. Determine the expected return and standard deviation risk of the resulting international portfolio.22This problem can be solved using the spreadsheetMPTSolver.xls.

Expected Return
The expected return is the profit or loss an investor anticipates on an investment that has known or anticipated rates of return (RoR). It is calculated by multiplying potential outcomes by the chances of them occurring and then totaling these...