ou put half of your money in a stock portfolio that has an expected return of 14% and a standard deviation of 24%. You put the rest of your money in a risky bond portfolio that has an expected return of 6% and a standard deviation of 12%. The stock and bond portfolios have a correlation of .55 and TB or Rf is 2%. What is the SR of the resulting portfolio?

Q: You are creating a portfolio of two stocks. The first one has a standard deviation of 20% and the…

A: Standard deviation of portfolio is calculated as follows:-SDp =whereSDp = standard deviation of…

Q: Assume your portfolio standard deviation is 8 whereas the market has a standard deviation of 6.8.…

A: First we need to determine the systematic risk using the formula below:

Q: "An investor can design a risky portfolio based on two stocks, A and B. Stock A has an expected…

A: Optimum risk portfolio is 0.084Explanation:

Q: You have identified the tangent market portfolio, which has an expected return of 10.4% and a…

A: Volatility of tangent portfolio (SD) = 33.9% Volatility of risk free portfolio = 0 Weight of tangent…

Q: You create a portfolio that invests 60% in stock A with E(rA) = 15%, σA = 10% and 40% in stock B…

A: According to bartleby guidelines , if question involves multiple sub parts , then 1st sub 3 parts…

Q: Suppose you have a portfolio consisting of two assets, A and B. Stock A has an expected return of…

A: Portfolio variance = w12σ12 + w22σ22 + 2w1w2Cov1,2Where:w1 = the portfolio weight of the first…

Q: You own a portfolio that is 39.3% invested in Stock X, 40.7% in Stock Y, and 20% in Stock Z. The…

A: Expected Return of the Portfolio = Weight of X *Return of X + Weight of Y * Return of Y + Weight of…

Q: 1. Consider the table below which lists a set of portfolios with each of their expected return E(R)…

A: To create the efficient frontier, we plot the expected return (E(R)) on the y-axis and the standard…

Q: You have a portfolio consisting solely of Stock A and Stock B. The portfolio has an expected return…

A: Portfolio is the combination of stocks and securities being held in business. Portfolio return means…

Q: Table attached shows the historical returns for Companies A, B and C If one investor has a…

A: The expected return of the stock refers to the profits that the stock provides on average. It is…

Q: You have a portfolio that is equally invested in Stock F with a beta of .95, Stock G with a beta of…

A: Calculation of beta of the portfolio:- The market beta is always equal to one. Portfolio beta = Beta…

Q: A portfolio has a total return of 4.5%, a standard deviation of 40%, and a beta of 0.5. The market…

A: Market return, Rm = 12%Standard deviation of market return = 20% Market's treynor measure = 0.10 We…

Q: What must the beta be for the other stock in your portfolio?

A: Beta is an estimate of risk prevailing in the market. When risk prevailing in the market is measured…

Q: a) Assuming Treasury bills yield is 1% and the market risk premium is 7%. If your portfolio beta is…

A: Note: Hi! Thank you for the question, As per the Honor code, we are allowed to answer one question…

Q: You have invested 0.21 percent of your overall money in risk free treasury bills, and the rest of…

A: The beta of the portfolio refers to the weights of the sum of the individual asset betas. It is…

Q: A portfolio is made up of share A and share B. Share A has a standard deviation of 16% and has a…

A: Rate of return of the portfolio is the average rate of return of each security comprised in the…

Q: Assume that when investing in the risky portfolio, the investor must choose between just two risky…

A: Standard deviation is a statistical metric that gauges the extent of variability or dispersion…

Q: A portfolio has a beta of 1.2 and an actual return of 14.1 percent. The risk-free rate is 3.5…

A: Given: Beta = 1.2 Actual return = 14.1% Risk free rate = 3.5% Market risk premium = 7.4%

Q: A portfolio has a total return of 4.5%, a standard deviation of 40%, and a beta of 0.5. The market…

A: Market return, Rm = 13.5%Standard deviation of market return = 20% Market's treynor measure = 0.10…

Q: Stock A has an expected return of 5% and a beta of .7. Stock B has an expected return of 9% and a…

A: Portfolio beta = (Weight of A * Beta of A) + ( Weight of B * Beta of B) Let's assume Weight of B = Y…

Q: 1) Stock 1 has a standard deviation of return of 7%. Stock 2 has a standard deviation of return of…

A: Standard Deviation of Stock 1 (A)=7% Standard Deviation of Stock 2(B)= 1% Weight of stock 1(WA)=…

Q: and bonds and Portfolio B which consists purely of cryptoc following information on the portfolios:…

A: Standard deviation is statical measure used in finance to measure the risk of security and it is…

Q: Assume you wish to construct a portfolio by investing $4000 in Stock A which has a return of 6% and…

A: Expected return of a portfolio is the sum of weighted average returns of individual stocks.

Q: What is the portfolio’s expected return?

A: A portfolio is the combination of different stocks, bonds and shares. The combination renders…

Q: Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Company A 30% 7% 18% -22% -14% 10% 26% -10%…

A: We have to design two portfolios and then find their average return, standard deviation of return…

Q: An equally-weighted portfolio that consists of 13 stocks has a beta of 1.5. If you replace one of…

A: As per the given information: Number of Stocks =13 Beta of 13 stocks = 1.5 Replacing Stock with a…

Q: Consider two high-risk stocks, X and Y. The expected return on stock Y is 16%, with a standard…

A: Computation of Expected Return as follows: The expected return of the portfolio =Weight of…

Q: You hold a portfolio consisting of two stocks. Stock Abc has an expected return of 209 and a…

A: expected return = 0.6*20% + 0.4*12% = 16.80%

Q: You own a portfolio that has $2,600 invested in Stock A and $3,700 invested in Stock B. Assume the…

A: The expected return is the return of the portfolio which is the sum of each potential return that is…

Q: 7. The standard deviation of stock A is 0.25 and the standard deviation of stock B is 0.30. The…

A: Portfolio refers to a combination or collection of financial instruments or securities stocks,…

Q: An investor can design a risky portfolio based on two stocks, A and B. Stock A has an expected…

A:

Q: have $95,621 to invest in two stocks and the risk-free security. Stock A has an expected return of…

A:

Q: Stock A has an expected return of 12 percent and a standard deviation of 14 percent. Stock B has an…

A: Honor codeAs per the Q&A guidelines, if multiple subparts are asked at once then the answer for…

Q: An investor can design a risky portfolio based on two stocks, A and B. Stock A has an expected…

A:

Q: You invest in a portfolio of 5 stocks with an equal investment in each one. The betas of the 5…

A: This consists of two parts: In the first part we need to calculate the beta of the portfolio. In the…

Q: Security A has a standard deviation of 10%. Security B . What is the covariance between the two…

A: We need to compute covariance and standard deviation as desired. Standard deviation of portfolio =…

Q: An investor is forming a portfolio by investing $50,000 in stock A which has a beta of 2.40, and…

A: Portfolio beta can be calculated by multiplying the the individual beta with its weight in…

Q: If you have an investment portfolio which is a mix of stock and bonds, with the stocks having a…

A: Information Provided: Stock return = 1.2% Stock weightage = 30% Bond return = 3.5% Bond weightage =…

Q: You are creating a new portfolio by investing 50% of your money in a stock fund and the rest in a…

A: Standard deviation of portfolio comprising of 2 securities is computed by following formula-Where,=…

Q: You own a portfolio that is 21 percent invested in Stock X, 36 percent in Stock Y, and 43 percent in…

A: The expected return is the estimation of profit or loss that an investor determines from his…

Q: You own a portfolio equally invested in a risk-free asset and two stocks. One of the stocks has a…

A: Formula Portfolio beta = (Weight of stock 1*Beta of stock 1)+(Weight of stock 2*Beta of stock 2)…