Using the data in the following table, and the fact that the correlation of A and B is 0.50, calculate the volatility (standard deviation) of a portfolio that is 50% invested in stock A and 50% invested in stock Realized Returns Year 2008 2009 2010 2011 2012 2013 Stock A - 6% 14% 9% - 9% 3% 12% Stock B 26% 33% 15% - 9% - 10% 18% The standard deviation of the portfolio is %. (Round to two decimal places.)
Using the data in the following table, and the fact that the correlation of A and B is 0.50, calculate the volatility (standard deviation) of a portfolio that is 50% invested in stock A and 50% invested in stock Realized Returns Year 2008 2009 2010 2011 2012 2013 Stock A - 6% 14% 9% - 9% 3% 12% Stock B 26% 33% 15% - 9% - 10% 18% The standard deviation of the portfolio is %. (Round to two decimal places.)
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter3: Risk And Return: Part Ii
Section: Chapter Questions
Problem 3P: Two-Asset Portfolio
Stock A has an expected return of 12% and a standard deviation of 40%. Stock B...
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Subject :- Accounting
![Using the data in the following table, and the fact that the correlation of A and B is 0.50, calculate the
volatility (standard deviation) of a portfolio that is 50% invested in stock A and 50% invested in stock B.
Year
2008
2009
2010
2011
2012
2013
Realized Returns
Stock A
- 6%
14%
9%
- 9%
3%
12%
Stock B
26%
33%
15%
- 9%
- 10%
18%
The standard deviation of the portfolio is %. (Round to two decimal places.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd7b6ce77-7d1f-42c7-90fc-6e082dc1db1b%2F7558bb32-26ad-4013-a6ed-d3627fafb8bd%2Fye4170v_processed.png&w=3840&q=75)
Transcribed Image Text:Using the data in the following table, and the fact that the correlation of A and B is 0.50, calculate the
volatility (standard deviation) of a portfolio that is 50% invested in stock A and 50% invested in stock B.
Year
2008
2009
2010
2011
2012
2013
Realized Returns
Stock A
- 6%
14%
9%
- 9%
3%
12%
Stock B
26%
33%
15%
- 9%
- 10%
18%
The standard deviation of the portfolio is %. (Round to two decimal places.)
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