Expected Return SD (s) Correlation Coefficient         Bond Fund 10% 10% -0.2         Stock Fund 16% 30%                                           If the risk-free rate of return is 8%, what is the proportion of the optimal (tangent) risky portfolio, invested in Stock Fund?

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A: Hi, since multiple subparts are posted, I will answer the first 3, as per guidelines. Please repost…

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A: Risk free rate = 8% Market return = 13% Stock beta = 1.20

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A: ProbabilityReturn on stock CReturn on stock D0.307%-9%0.5011%14%0.20-16%26%Proportion invested25%75%

Q: compared to the company stock?

A: “Since you have asked multiple question, we will solve the first question for you. If youwant any…

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A: > R -squared  = Correlation ^2> Here> Correlation = 0.72

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A: Answer a.Weight of Stock A = 0.40Weight of Stock B = 0.40Weight of Stock C = 0.20Boom:Expected…

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