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Calculate the expected return and standard deviation

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Question - You are interested in using short selling to increase the possible returns from your portfolio. You have short sold $200 of ABC and invested $1,200 in DEF. The following data are available on ABC and DEF: ABC DEF Expected return 3% 15% Standard deviation 7% 35% The correlation between ABC and DEF is 0.4. Calculate the expected return and standard deviation of the portfolio.

Reference no: EM133038719

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