Assume that an investor decides to hold a portfolio with 80 percent invested in GE stock and the remaining 20 percent invested in Apple Inc. stock. The expected return is 9.93 percent for the GE stock and 18.20 percent for the Apple Inc. stock. The risk (standard deviation) is 16.21 percent for the GE stock and 33.11 percent for Apple Inc. stock. What will be the portfolio's expected return given that the covariance between the two stocks is 0.5 percent or 0.0050? Group of answer choices 15.10% 10.90 % 11.58% 2.54%

Assume that an investor decides to hold a portfolio with 80 percent invested in GE stock and the remaining 20 percent invested in Apple Inc. stock. The expected return is 9.93 percent for the GE stock and 18.20 percent for the Apple Inc. stock. The risk (standard deviation) is 16.21 percent for the GE stock and 33.11 percent for Apple Inc. stock. What will be the portfolio's expected return given that the covariance between the two stocks is 0.5 percent or 0.0050? Group of answer choices 15.10% 10.90 % 11.58% 2.54%

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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