What is the expected return of the proposed portfolio

Reference no: EM13280151

A U.S. investor is considering a portfolio consisting of 60% invested in the U.S. equity index fund and 40% invested in the British equity index fund. The expected returns for the funds are 10% for the U.S. and 8% for the British, standard deviations of 20% for the U.S. and 18% for the British, and a correlation coefficient of 0.30 between the U.S. and British equity funds.

a) What is the expected return of the proposed portfolio?

b) What is standard deviation of the proposed portfolio?

Reference no: EM13280151

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