4. You own a Portfolio that is invested 43 percent in Stock A, 16 percent in...

4. You own a Portfolio that is invested 43 percent in Stock A, 16 percent in Stock B, and 41 percent in Stock C. The “Expected Returns” on Stocks A, B, and C are: 9.1 percent, 16.7 percent, and 11.4 percent, respectively. What is the “Variance” of the Portfolio and What is the “Standard Deviation” of the Returns on this Stock?

Solutions

Expert Solution

Solution :

The “Variance” of the Portfolio = 6.7492

= 6.75 ( When rounded off to two decimal places )

The “Standard Deviation” of the Returns on this Stock = 2.5979 %

= 2.60 % ( When rounded off to two decimal places )

Please find the attached screenshot of the excel sheet containing the detailed calculation for the solution.

jeff jeffy answered 1 year ago

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