What is the portfolio standard deviation

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Question - A portfolio contains two assets. The first asset comprises 40 percent of the portfolio and has a standard deviation of 0.1, and the other asset has a standard deviation of 0.5.

If the correlation coefficient between the two assets is 0.2, what is the portfolio's standard deviation?

What recommendation would you give a risk averse investor if the expected return on the portfolio is 12%?  (Explain your answer.)

Reference no: EM133075541

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