Computation efficient frontier for strategic decision

Reference no: EM1317447

Calculate an Efficient Frontier

Stock	Mean Rate of Return	Standard Deviation
A	12%	6.00%
B	9%	4.00%
C	18%	12.00%

How?

-Pick y to be your investment in Stock A, where y goes from 0 to 1

-Increment size? Your choice. You can try 0.25 to start, ideally down to 0.01.

Pick z to be your investment in Stock B, where z goes from 0 to 1 - y

Therefore you invest (1 - y - z) in C

Calculate for each y and z, your portfolio\'s return and standard deviation

Plot the graph of the resulting portfolio returns and standard deviations

Reference no: EM1317447

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