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Assume that the % expected return for security A and the market M for a good,...

Assume that the % expected return for security A and the market M for a good, normal and bad economy (probabilities .2,.6,.2) are 18, 14, and 8 for A and 16, 22, and 12 for M. Also assume that you invest 70% in A and 30% in M. Compute the minimum risk portfolio weight for A.

.45

.35

.72

.28

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I HAVE DONE VERY SIMPLE MANUAL CALCULATIONS SO THAT IT IS EASY TO UNDERSTAND EACH STEP. THANK YOU

jeff jeffy answered 1 year ago
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