A portfolio has 45% of its value in IBM shares and the rest in Microsoft (MSFT). The valability of IBM and MSFT are 40% and 30%, respectively, and the correlation between BM and MSFT is -0.1. What is the standard deviation of the portfolio? OA 25.56% OB. 22.08% OC. 23.24% OD. 20.91%

A portfolio has 45% of its value in IBM shares and the rest in Microsoft (MSFT). The valability of IBM and MSFT are 40% and 30%, respectively, and the correlation between BM and MSFT is -0.1. What is the standard deviation of the portfolio? OA 25.56% OB. 22.08% OC. 23.24% OD. 20.91%

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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Question

A portfolio has 45% of its value in IBM shares and the rest in Microsoft (MSFT). The valability of IBM and MSFT are 40% and 30%, respectively, and the correlation between 1BM and
MSFT is -0.1. What is the standard deviation of the portfolia?
OA 25.56%
OB. 22.08%
OC. 23.24%
OD. 20.91%

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