In: Finance
Your financial adviser provided you with the following data about combinations of a Technology and a Utility fund:
E(r) |
σ |
weight invested in Technology fund |
weight invested in Utility fund |
|
ORP |
12 |
30 |
50 |
50 |
MVP |
6 |
24 |
70 |
30 |
Your risk aversion coefficient is A=4 and the risk free rate is 2%.
If you have $1000, how much money do you need to invest in the Technology fund to maximize your utility?