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Calculate the volatility of a portfolio

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Reference no: EM132014065

Suppose Johnson? & Johnson and Walgreen Boots Alliance have expected returns and volatilities shown here, with a correlation of 24%. Calculate

a. the expected return and

b. the volatility(standard deviation) of a portfolio that consists of a long position of $8,500 in Johnson & Johnson and a short position of $1,000 in Walgreens.

Expected Return Standard Deviation

Johnson & Johnson 7.2% 15.1%

Walgreens 9.1% 20.8%

Reference no: EM132014065

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