1.5 Assume portfolio A has a collection of stocks that average a 12% return with a...

1.5 Assume portfolio A has a collection of stocks that average a 12% return with a standard deviation of 3% and portfolio B has an average return of 6% with a standard deviation of 2%. Which portfolio among the two assets would be considered riskier?

2 points

None is these answers is correct

Portfolio A

Portfolio B

Both Portfolio A and B

Solutions

Expert Solution

Q: Assume portfolio A has a collection of stocks that average a 12% return with a standard deviation of 3% and portfolio B has an average return of 6% with a standard deviation of 2%.Which portfolio among the two assets would be considered riskier?

Answer: Portfolio B.

Explanation

Given that σa=3 x̅a=12 and σb=2, x̅b=6.

orchestra answered 1 year ago

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