You are faced with a decision to invest 100000 in only two

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Reference no: EM13620076

You are faced with a decision to invest $100,000 in only two mutual funds. The two funds are Fidelity Contrafund (FCNTX) and Fidelity Intermediate Bond (FTHRX). You need to advise how much to put in each fund in the case of the optimal risky portfolio and the minimum variance portfolio. So to answer this question you will need to calculate the weights of each fund in each portfolio. To calculate these weights you will need to compute the correlation or covariance between these two funds which can be done using excel. Use only 5 years of data. Explain to me what the optimal risky and minimum variance portfolio mean and calculate a sharpe ratio for each (assume a 1% risk free rate)

Reference no: EM13620076

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