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What is the equation of Shakib Capital Allocation Line

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Question - Your client, Shakib Al Hasan, holds a complete portfolio that consists of a portfolio of risky assets (RISKY ASSETS) and T-Bills. The information below refers to these assets. Expected return of RISKY ASSETS 12.00% Standard deviation of RISKY ASSETS 7.20% T-bill rate 3.60% Proportion of complete portfolio in RISKY ASSETS 80.00% Proportion of complete portfolio in T-bills 20.00% Composition of RISKY ASSETS: Stock A 40.00% Stock B 25.00% Stock C 35.00%

a. What is the expected return on Shakib's complete portfolio?

b. What is the standard deviation of Shakib's complete portfolio?

c. What is the equation of Shakib's Capital Allocation Line?

d. What are the proportions of Stocks A, B, and C, respectively in Shakib's complete portfolio?

Reference no: EM132943667

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