Consider four uncorrelated assets

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Reference no: EM131067576

Consider four uncorrelated assets A,B,C,D with returns 1%, 3%, 5%, 8% and risks 0%, 10%, 20%, 30%.

What is the minimum-risk portfolio comprised of assets B,C,D only?

What is the tangency portfolio comprised assets B,C,D only? What is the risk?

You are the financial advisor and your client has a maximum risk tolerance of 5%.

How would you allocate your client’s portfolio between all four assets A,B,C,D? What is the corresponding return?

Reference no: EM131067576

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