What is the standard deviation of portfolio invested

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The correlation between the returns of three stocks A, B, C are given in the following tables:

The expected rates of returns on A, B, and C are 16%, 12%, and 15% respectively. The corresponding standard deviations of the returns are 25%, 22%, and 25%.

a. What is the standard deviation of a portfolio invested 25% in stock A, 25% in stock B, and 50% in Stock C?

b. You plan to invest 50% of your money in the portfolio constructed the part a and 50% in the risk-free assets. The risk-free interest rate is 5%. What is the expected return on this investment? What is the standard deviation of the returns on this investment?

Please show me how to find the answer in Microsoft Excel. I need to know the formula/inputs used in the solution.

Reference no: EM131896867

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