What the risk-free portfolio that can be formed

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Consider two perfectly negatively correlated risky securities, K and L. K has an expected rate of return of 13% and a standard deviation of 19%. L has an expected rate of return of 10% and a standard deviation of 16%.

Question 1: The risk-free portfolio that can be formed with the two securities will earn _____ rate of return

A. 11.4%

B. None of the options are correct

C. 9.9%

D. 10.9%

E. 9.5%

Reference no: EM132569771

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