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Find the expected return for the portfolio

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A portfolio is composed of two stocks, A and B. Stock A has anexpected return of 12% while stock B has an expected return of 15%. Stock A has a standard deviation of return of 5% while stock B has a standard deviation of return of 15%. The correlation coefficientbetween the returns on A and B is 0.8. Stock A comprises 30% of the portfolio while stock B comprises 70% of the portfolio.

-Find the expected return for the portfolio

-Find the variance of the portfolio

Please write out the formulas and show work

Reference no: EM132842609

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