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In: Finance

Q3.15You have been given the following return data on three assets: F, G and H and...

Q3.15You have been given the following return data on three assets: F, G and H and the two portfolios – over the period 2013 to 2016:

Year

Asset F

Asset G

Asset H

Portfolio FG

Portfolio FH

2013

16

17

14

16.5

15

2014

17

16

15

16.5

16

2015

18

15

16

16.5

17

2016

19

14

17

16.5

18

Using these assets, you have isolated three investment alternatives:

  1. 100% of Asset F
  2.   50% of Asset F and 50% of Asset G
  3.   50% of Asset F and 50% of Asset H

Required:

  1. Calculate the expected return for each of the three investment alternatives
  2. Calculate the standard deviation of returns for each of the three investment alternatives
  3. Based on your findings above, which of the three investment alternatives would you recommend? Justify your choice.

Solutions

Expert Solution

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

As nothing was mentioned excel is used. If you need with formula, let me know, will do that also. Thank you.

jeff jeffy answered 1 year ago
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