How much should be invested in a

Assignment Help Finance Basics
Reference no: EM132752810

A portfolio with one risk-free asset and one risky asset One portfolio consisting of one risk-free asset and one risky asset where you wish to have a standard deviation of the portfolio of 25 %.The standard deviation of the risky asset is 30 %.

How much should be invested in the risk-free asset and how much should be invested in the risky asset?

One portfolio consisting of two stocks, A and B, with the goal of having as low risk as possible (risk is measured as the standard deviation of the portfolio). The standard deviation of A is 25 % while it is30 % for B. The correlation coefficient between the two stocks is 0.6

How much should be invested in A and how much should be invested in B?

Reference no: EM132752810

Questions Cloud

Describe the adjusted cost base of the common shares : Which one of the following is the adjusted cost base of the preferred shares (first) and the adjusted cost base of the common shares (second)?
Influence inter-industry wage-salary differentials : Discuss at least two factors that you believe influence inter-industry wage/salary differentials. Support your rationale.
Develop a policy and procedure framework that can be applied : Develop a Policy and Procedure Framework that can be applied to projects and programs. List five organizational and external program compliance requirements.
Prepare bank reconciliation for Apex Company on December : Check from Dave Hilman returned for insufficient funds (NSF) 800 and Outstanding checks 5,250. Prepare bank reconciliation for Apex Company on December
How much should be invested in a : How much should be invested in A and how much should be invested in B?
Beneficial for organization from standpoint of productivity : How can complementary assets be beneficial for an organization from the standpoint of productivity?
Describe a project or program management control system : Describe a Project or Program Management control system used to monitor program progress. List five methods used when making decisions regarding complex
Correlation coefficient between the two stocks : How much should be invested in A and how much should be invested in B?
Develop program governance structure : Develop your own Program Governance Structure that includes teams/ working groups in the following areas: Risk, Financial, Resourcing

Reviews

Write a Review

Finance Basics Questions & Answers

  Explain the price as empirical appearance for value

Explain the he relation between value and price. Explain the price as empirical appearance for value. What is organic composition of capital (C/V)? Equal rate of profit? Why? Keyword: competition

  What factors determine the required rate of return for any

what factors determine the required rate of return for any

  What is the amount of currrency in billions

What is the amount of currrency in billions of dollars in the economy from the given info (assume no traveler's checks).

  Key role in the wacc valuation framework

"The interest tax shield plays a key role in the WACC valuation framework". Discuss

  What actions might a car buyer take if a lemon is purchased

With a click of the mouse, Mackenzie enters the auto "showroom." In the past few months she had realized that the repair costs for her 11-year-old car.

  Default risk premium

A Treasury bond that matures in 10 years has a yield of 4%. A 10-year corporate bond has a yield of 9%. Assume that the liquidity premium on the corporate bond is 0.55%. What is the default risk premium on the corporate bond? Round your answer to ..

  Required rate return and risk analysis

Stocks coefficient of variation, required rate return and risk analysis - Calculate each stock's coefficient of variation. and Which stock is riskier for a diversified investor?

  Consider the experiment of drawing two cards from a deck in

1consider the experiment of drawing two cards from a deck in which all picture cards have been removed and adding their

  Briefly describe the troubled asset relief program

What was the derivative used in the program? Why would the US government trade such a "toxic thing" as a derivatives contract?

  Compute the cost of common stock

Compute the cost of common stock (pick a method) if the following are given. The Dukes Corporation is contemplating issuance of a 9% preferred stock.

  Accumulate in a private pension fund

How much Jim can accumulate in a private pension fund over 20 years if the fund offers 5% interest compounded annually, and he can afford to deposit $2,000 at the end of every 2nd year?

  Computing the unknown distribution

A random sample of size n = 50 is taken from a large population with mean 15 and variance 4, but unknown distribution. (i) What is the standard deviation σX¯ of the sample mean?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd