You are expecting either a recession or steady growth next year. Recession has a 19% probability...

You are expecting either a recession or steady growth next year. Recession has a 19% probability of happening. In steady growth, stock ABC returns 12.75% and stock XYZ returns 9.75%. In a recession, stock ABC returns -6.50% and stock XYZ returns -4.30%. You are going to put together a portfolio of these two stocks with positive portfolio weight in each and allocate 61% of the portfolio to ABC with the remainder to XYZ. What is the variance of the portfolio?

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jeff jeffy answered 1 year ago

You are expecting either a recession or steady growth next year. Recession has a 19% probability...

You are expecting either a recession or steady growth next year. Recession has a 19% probability of happening. In steady growth, stock ABC returns 12.75% and stock XYZ returns 9.75%. In a recession, stock ABC returns -6.50% and stock XYZ returns -4.30%. You are going to put together a portfolio of these two stocks with positive portfolio weight in each and allocate 61% of the portfolio to ABC with the remainder to XYZ. What is the variance of the portfolio?

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You are expecting either a recession or steady growth next year. Recession has a 31% probability...

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You are expecting either a recession or steady growth next year. Recession has a 25% probability...

You are expecting either a recession or steady growth next year. Recession has a 25% probability of happening. In steady growth, stock ABC returns 12.00% and stock XYZ returns 9.00%. In a recession, stock ABC returns -6.20% and stock XYZ returns -4.00%. You are going to put together a portfolio of these two stocks with positive portfolio weight in each and allocate 55% of the portfolio to ABC with the remainder to XYZ. What is the variance of the portfolio?...

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You are expecting either a recession or steady growth next year. Recession has a 33% probability of happening. In steady growth, stock ABC returns 11.00% and stock XYZ returns 8.00%. In a recession, stock ABC returns -5.80% and stock XYZ returns -3.60%. You are going to put together a portfolio of these two stocks with positive portfolio weight in each and allocate 47% of the portfolio to ABC with the remainder to XYZ. What is the variance of the portfolio?...

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You are expecting either a recession or steady growth next year. Recession has a 19% probability...

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