Consider the following information: Stock Reliance HUL Expected return (%) 25 22 Variance of return (%2) 18 16 Covariance (%2) 8 The combination of the two stocks will have lesser risk than the risk of either asset taken alone if coefficient of correlation between the HUL and Reliance stock is less than ? Also find the minimum risk portfolio.
Consider the following information: Stock Reliance HUL Expected return (%) 25 22 Variance of return (%2) 18 16 Covariance (%2) 8 The combination of the two stocks will have lesser risk than the risk of either asset taken alone if coefficient of correlation between the HUL and Reliance stock is less than ? Also find the minimum risk portfolio.
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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- Consider the following information:
Stock |
Reliance |
HUL |
Expected return (%) |
25 |
22 |
Variance of return (%2) |
18 |
16 |
Covariance (%2) |
|
8 |
The combination of the two stocks will have lesser risk than the risk of either asset taken alone if coefficient of correlation between the HUL and Reliance stock is less than ? Also find the minimum risk portfolio.
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