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A portfolio has 50% of its funds invested in Security A and 50% of its funds invested in Security B. Security A has a standard deviation of 4. Security B has a standard deviation of 10. The securities have a coefficient of correlation of 0.5. Which of the following values is closest to portfolio variance? O a. 48.16 O b.39.00 O. 79.00 O d.6.245

A portfolio has 50% of its funds invested in Security A and 50% of its funds invested in Security B. Security A has a standard deviation of 4. Security B has a standard deviation of 10. The securities have a coefficient of correlation of 0.5. Which of the following values is closest to portfolio variance? O a. 48.16 O b.39.00 O. 79.00 O d.6.245

Essentials Of Investments
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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Save Answer A portfolio has 50% of its funds invested in Security A and 50% of its funds invested in Security B. Security A has a standard deviation of 4. Security B has a standard deviation of 10. The securities have a coefficient of correlation of 0.5. Which of the following values is closest to portfolio variance? a. 48.16 b. 39.00 c. 79.00 d. 6.245
Transcribed Image Text:Save Answer A portfolio has 50% of its funds invested in Security A and 50% of its funds invested in Security B. Security A has a standard deviation of 4. Security B has a standard deviation of 10. The securities have a coefficient of correlation of 0.5. Which of the following values is closest to portfolio variance? a. 48.16 b. 39.00 c. 79.00 d. 6.245
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