2024 – Hyacinth Macaw invests 74 of her funds in stock I and the balance in stock J The standard deviation
Finance – 2024
|
Hyacinth Macaw invests 74% of her funds in stock I and the balance in stock J. The standard deviation of returns on I is 13%, and on J it is 27%. |
| a. |
Calculate the variance of portfolio returns, assuming the correlation between the returns is 1.0. (Do not round intermediate calculations. Enter your answer as a decimal rounded to 4 places.) |
| Portfolio variance | n/r |
| b. |
Calculate the variance of portfolio returns, assuming the correlation is 0.7. (Do not round intermediate calculations. Enter your answer as a decimal rounded to 4 places.) |
| Portfolio variance | n/r |
| c. |
Calculate the variance of portfolio returns, assuming the correlation is 0. (Do not round intermediate calculations. Enter your answer as a decimal rounded to 4 places.) |
| Portfolio variance | n/r |
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