A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term bond fund, and the thirdis a money market fund that provides a safe return of 8%. The characteristics of the risky funds are as follows:Stock fund (S)Bond fund (B)The correlation between the fund returns is 0.10.Proportionin Stock FundExpected StandardReturn Deviation20%12Tabulate the investment opportunity set of the two risky funds.Note: Round your answers to 2 decimal places.0.00 %20.0040.0060.0080.00100.00Proportionin Bond Fund30%15100.00 %80.0060.0040.0020.000.00ExpectedReturn%StandardDeviation%

FROM THE INFORMATION PROVIDED IN QUESTION WE HAVE TO FIND OUT INVESTMENT OPPORTUNITY SET OF TWO…

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term bond fund, and the third is a money market fund that provides a safe return of 8%. The characteristics of the risky funds are as follows: Stock fund (S) Bond fund (B) The correlation between the fund returns is 0.10. Tabulate the investment opportunity set of the two risky funds. Note: Round your answers to 2 decimal places. Proportion in Stock Fund Expected Standard Return Deviation 30% 15 20% 12 0.00 % 20.00 40.00 60.00 80.00 100.00 Proportion in Bond Fund 100.00 % 80.00 60.00 40.00 20.00 0.00 Expected Return % Standard Deviation %

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term bond fund, and the third is a money market fund that provides a safe return of 8%. The characteristics of the risky funds are as follows: Stock fund (S) Bond fund (B) The correlation between the fund returns is 0.10. Tabulate the investment opportunity set of the two risky funds. Note: Round your answers to 2 decimal places. Proportion in Stock Fund Expected Standard Return Deviation 30% 15 20% 12 0.00 % 20.00 40.00 60.00 80.00 100.00 Proportion in Bond Fund 100.00 % 80.00 60.00 40.00 20.00 0.00 Expected Return % Standard Deviation %

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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fast answer correctly
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