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What is the expected return and standard deviation

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You consider investing in three assets: CVX, IBM, and the risk-free asset. You decide to use the following inputs: E[rCVX]=7.6%, σCVX=19.4%, E[rIBM]=9.8%, σIBM=27.5%, rf=3.0%, ρCVX,IBM=0.239.

What is the expected return and standard deviation of the portfolio that invests w=25% in CVX and 75% in IBM? Make sure to indicate what formulas to use and to show your work.

Reference no: EM132499284

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