You have a portfolio with a standard deviation of 30% and an expected return of 19% You are considering adding one of the two stocks in the following table. If after adding the stock you will have 25% of your money in the new stock and 75% of your money in your existing portfolio, which one should you add? Stock A Stock B Expected Return 13% 13% Standard Deviation 25% 16% Correlation with Your Portfolio's Returns 03 05 Standard deviation of the portfolio with stock A is 25.09% (Round to two decimal places) Standard deviation of the portfolio with stock B is % (Round to two decimal places)

You have a portfolio with a standard deviation of 30% and an expected return of 19% You are considering adding one of the two stocks in the following table. If after adding the stock you will have 25% of your money in the new stock and 75% of your money in your existing portfolio, which one should you add? Stock A Stock B Expected Return 13% 13% Standard Deviation 25% 16% Correlation with Your Portfolio's Returns 03 05 Standard deviation of the portfolio with stock A is 25.09% (Round to two decimal places) Standard deviation of the portfolio with stock B 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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