Consider the following information on Stocks A, B, C and their returns (in decimals) in each state: State Prob. of State A Boom 20% 0.34 0.21 0.16 Good 45% 0.13 0.11 0.08 Poor 25% 0.01 0.03 Bust 10% -0.1 -0.06 -0.03 If your portfolio is invested 25% in A, 40% in B, and 35% in C, what is the standard deviation of the portfolio in percent? Answer to two decimals, carry intermediate calcs. to at least four decimals.
Consider the following information on Stocks A, B, C and their returns (in decimals) in each state: State Prob. of State A Boom 20% 0.34 0.21 0.16 Good 45% 0.13 0.11 0.08 Poor 25% 0.01 0.03 Bust 10% -0.1 -0.06 -0.03 If your portfolio is invested 25% in A, 40% in B, and 35% in C, what is the standard deviation of the portfolio in percent? Answer to two decimals, carry intermediate calcs. to at least four decimals.
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
Related questions
Question
![Consider the following information on Stocks A, B, C and their returns (in decimals) in each state:
State
Prob. of State
A
Boom
20%
0.34
0.21
0.16
Good
45%
0.13
0.11
0.08
Poor
25%
0.01
0.03
Bust
10%
-0.1
-0.06
-0.03
If your portfolio is invested 25% in A, 40% in B, and 35% in C, what is the standard deviation of the
portfolio in percent? Answer to two decimals, carry intermediate calcs. to at least four decimals.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8ec833a3-b990-467b-9d10-81f5d3a0e6ff%2Fabe7c399-c698-43f4-994d-7c986a00d582%2Ftqkjwgc.png&w=3840&q=75)
Transcribed Image Text:Consider the following information on Stocks A, B, C and their returns (in decimals) in each state:
State
Prob. of State
A
Boom
20%
0.34
0.21
0.16
Good
45%
0.13
0.11
0.08
Poor
25%
0.01
0.03
Bust
10%
-0.1
-0.06
-0.03
If your portfolio is invested 25% in A, 40% in B, and 35% in C, what is the standard deviation of the
portfolio in percent? Answer to two decimals, carry intermediate calcs. to at least four decimals.
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