Calculate the standard deviation of the portfolio

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Reference no: EM131940412

Stock A has an expected return of 10% and a standard deviation of 30%. Stock B has an expected return of 13% and a standard deviation of 45%. The correlation coefficient between Stocks A and B is 0.25. Stock A has a beta of .85 and Stock B has a beta of 1.20. Portfolio is invested 40% in Stock A and 60% in Stock B.

Calculate the expected return of the portfolio.

Calculate the standard deviation of the portfolio.

Calculate the beta of the portfolio

Is the portfolio likely to do better or worse than average when the stock market is going down? Why?

Reference no: EM131940412

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