Tyler Trucks stock has an annual return mean and standard deviation of 13.0 percent and 42 percent, respectively. Michael Moped Manufacturing stock has an annual return mean and standard deviation of 13.0 percent and 68 percent, respectively. Your portfolio allocates equal funds to Tyler Trucks stock and Michael Moped Manufacturing stock. The return correlation between Tyler Trucks and Michael Moped Manufacturing is -50. What is the smallest expected loss for your portfolio in the coming month with a probability of 16.0 percent? Note: A negative value should be indicated by a minus sign. Do not round intermediate calculations. Round the z-score value to 3 decimal places when calculating your answer. Enter your answer as a percent rounded to 2 decimal places. Smallest expected loss %

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
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Tyler Trucks stock has an annual return mean and standard deviation of 13.0 percent and 42 percent, respectively. Michael Moped
Manufacturing stock has an annual return mean and standard deviation of 13.0 percent and 68 percent, respectively. Your portfolio
allocates equal funds to Tyler Trucks stock and Michael Moped Manufacturing stock. The return correlation between Tyler Trucks and
Michael Moped Manufacturing is -50. What is the smallest expected loss for your portfolio in the coming month with a probability of
16.0 percent?
Note: A negative value should be indicated by a minus sign. Do not round intermediate calculations. Round the z-score value to 3
decimal places when calculating your answer. Enter your answer as a percent rounded to 2 decimal places.
Smallest expected loss
%
Transcribed Image Text:Tyler Trucks stock has an annual return mean and standard deviation of 13.0 percent and 42 percent, respectively. Michael Moped Manufacturing stock has an annual return mean and standard deviation of 13.0 percent and 68 percent, respectively. Your portfolio allocates equal funds to Tyler Trucks stock and Michael Moped Manufacturing stock. The return correlation between Tyler Trucks and Michael Moped Manufacturing is -50. What is the smallest expected loss for your portfolio in the coming month with a probability of 16.0 percent? Note: A negative value should be indicated by a minus sign. Do not round intermediate calculations. Round the z-score value to 3 decimal places when calculating your answer. Enter your answer as a percent rounded to 2 decimal places. Smallest expected loss %
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