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Invest equally-proportion in all three securities

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Reference no: EM132543810

Suppose that only three funds are traded in the market (well-diversified funds):

Fund A Fund B Fund C

Expected Return 0.10

0.15

0.20

Standard Deviation 0.15

0.20

0.25

=0; =0.5; =-0.5

Assuming you would like to invest your money equally in two securities (50%- 50%), which two securities should you choose?

Would you recommend invest equally-proportion in all three securities? Support your answer with explanation.

Reference no: EM132543810

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