What is the standard deviation for portfolio

Assignment Help Financial Management
Reference no: EM131969538

Suppose Stock A has an expected return of 15%, a standard deviation of 20%, and a Beta of 0.4 while Stock B has an expected return of 25%, a standard deviation of 30% and a beta of 1.25, and the correlation between the two stocks is 0.25. What is the standard deviation for a portfolio with 80% invested in Stock A and 20% invested in Stock B?

Reference no: EM131969538

Questions Cloud

Calculate the npv and irr with and without mitigation : An electric utility is considering a new power plant in northern Arizona. Power from the plant would be sold in the Phoenix area, where it is badly needed.
Share a disruptive technology : Several technologies seemed futuristic a few years ago, but are reality today. Share a disruptive technology and explain the difference it is making to health.
What is the range of risk aversion for which client : What is the range of risk aversion for which a client will neither borrow nor lend, that is, for which y = 1?
Amount of your profit or loss from position in call option : Determine the total dollar amount of your profit or loss from your position in the call option.
What is the standard deviation for portfolio : What is the standard deviation for a portfolio with 80% invested in Stock A and 20% invested in Stock B?
What advancement barriers is marina encountering : What advancement barriers is Marina encountering? What should Roy have said when Marina told him she was pregnant?
What is expected return for portfolio : What is the expected return for a portfolio with 80% invested in Stock A and 20% invested in Stock B?
Define the roles of manager : Without using any outside sources. Define the roles of manager and the role of human resource manager.
Approval before taking decisions : Jenny is likely to belong to a culture that:

Reviews

Write a Review

Financial Management Questions & Answers

  Markets risk-free rate

One year ago, Matt bought 100 shares of ACE Corp. stock for $5,619 including commission. He is about to sell the ACE stock for $6,528 net of commissions. When he made the purchase the S&P 500 index was at 907; now it is 1070. The beta of ACE stock is..

  Who has covered interest arbitrage opportunity

Interest rates 2% lower in the U.S. than in foreign country. The foreign currency exhibits 3% forward discount. Who has covered interest arbitrage opportunity?

  Profit margin for roa and assets turnover components

Compute the rate of ROA. Disaggregate ROA into profit margin for ROA and assets turnover components.

  Historical cost of capital

Consider a situation where the company uses the same fixed historical cost of capital for any new investment,

  Source market value market proportions costs

Source Market Value Market Proportions Costs Weighted Costs Debt $ .0122 Preferred 1,080,000 Equity .6489 Total ? WACC = ?

  Currently saving to have necessary funds for linda education

for the next five years in addition to the $5,100 they are currently saving to have the necessary funds for Linda's education?

  Ethanol futures contracts are based

Ethanol futures contracts are based on 29,000 gallons and are priced in dollars per gallon.

  What happen if management does not fulfill responsibilities

Discuss what could happen if management does not fulfill responsibilities related to finance. Describe why cash flow is more important than sales in a business.

  Market value of the house mortgage

A person has a net asset of $1 million, including a $300,000 net equity of a house (market value of the house – mortgage). Specifically, the house has a market value of $600,000 including $400,000 for the structure and $200,000 for the land, and a mo..

  A confirmed letter of credit

A confirmed letter of credit

  Outstanding balance on your credit card

You have an outstanding balance on your credit card of $10,000. You can pay off the balance if you make 36 monthly payments of $350, starting next month. Alternatively, you can take out a bank loan today for $10,000 and pay off the credit card debt. ..

  Why the spread must have a positive value now

Explain, using the fundamental principle, why the spread must have a positive value now.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd