You have decided to invest 40% of your wealth in McDonalds which has an expected return...

You have decided to invest 40% of your wealth in McDonalds which has an expected return of 15% and a standard deviation of 15%, and 60% of your wealth in GE which has an expected return of 9% and a standard deviation of 14%. If the correlation McDonalds and GM is 0.5, what is the standard deviation of your portfolio?

a) 11.4%
b) 13.1%
c) 12.51%
d) 10%

Expert Solution

jeff jeffy answered 2 years ago

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