QUESTION 22 You decide to invest in a portfolio consisting of 20% Stock A, 20% Stock B, and the remainder in Stock C. Based on what is the standard deviation of your portfolio? State of Economy Probability of State Economy Return if State Occurs Stock A Stock B Stock C Recession 0.15 -5% -3% -6% Normal 0.55 8% 5% 2% Boom 0.30 15% 10% 15% 0.123243 O 0.004044 O 0.063591 0.043243 D

QUESTION 22 You decide to invest in a portfolio consisting of 20% Stock A, 20% Stock B, and the remainder in Stock C. Based on what is the standard deviation of your portfolio? State of Economy Probability of State Economy Return if State Occurs Stock A Stock B Stock C Recession 0.15 -5% -3% -6% Normal 0.55 8% 5% 2% Boom 0.30 15% 10% 15% 0.123243 O 0.004044 O 0.063591 0.043243 D

Fundamentals of Financial Management (MindTap Course List)

15th Edition

ISBN:9781337395250

Author:Eugene F. Brigham, Joel F. Houston

Publisher:Eugene F. Brigham, Joel F. Houston

Chapter18: Derivatives And Risk Management

Section: Chapter Questions

Problem 4P: Intermediate Problems 4-5 BLACK-SCHOLES MODEL Assume that you have been given the following...

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10. Returns and Standard Deviations [LO1] Consider the following information: Rate of Return If State Occurs
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