Your eccentric Aunt Claudia has left you $50,000 in BP shares plus $50,000 cash. Unfortunately, her will requires that the BP stock not be sold for one year and the $50,000 cash must be entirely invested in one of the stocks shown below. BHP Billiton Siemens Nestlé LVMH Toronto Dominion Bank Samsung BP Standard deviation (%) BHP Billiton Siemens 1.00 0.20 1.00 27.10 19.90 Nestlé -0.10 0.34 1.00 13.80 LVMH 0.23 0.22 0.23 1.00 20.90 Toronto Dominion Bank 0.41 0.15 0.24 0.08 1.00 16.70 Samsung 0.33 0.29 0.16 0.22 0.20 1.00 26.70 ВР 0.30 0.21 0.24 0.12 0.16 0.17 1.00 22.00 a. Calculate the portfolio variance for seven different portfolios. (Use decimals, not percents, in your calculations. Do not round
Your eccentric Aunt Claudia has left you $50,000 in BP shares plus $50,000 cash. Unfortunately, her will requires that the BP stock not be sold for one year and the $50,000 cash must be entirely invested in one of the stocks shown below. BHP Billiton Siemens Nestlé LVMH Toronto Dominion Bank Samsung BP Standard deviation (%) BHP Billiton Siemens 1.00 0.20 1.00 27.10 19.90 Nestlé -0.10 0.34 1.00 13.80 LVMH 0.23 0.22 0.23 1.00 20.90 Toronto Dominion Bank 0.41 0.15 0.24 0.08 1.00 16.70 Samsung 0.33 0.29 0.16 0.22 0.20 1.00 26.70 ВР 0.30 0.21 0.24 0.12 0.16 0.17 1.00 22.00 a. Calculate the portfolio variance for seven different portfolios. (Use decimals, not percents, in your calculations. Do not round
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
Section: Chapter Questions
Problem 1PS
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Ashvin
Transcribed Image Text:Your eccentric Aunt Claudia has left you $50,000 in BP shares plus $50,000 cash. Unfortunately, her will requires that the BP stock not
be sold for one year and the $50,000 cash must be entirely invested in one of the stocks shown below.
BHP Billiton
Siemens
Nestlé
LVMH
Toronto Dominion Bank
Samsung
BP
Standard deviation (%)
BHP
Billiton Siemens
1.00
0.20
1.00
BHP
Siemens
Nestlé
LVMH
Toronto Dominion Bank
Samsung
BP
27.10
Portfolio Variance
19.90
Nestlé
-0.10
0.34
1.00
13.80
LVMH
0.23
0.22
0.23
1.00
20.90
Toronto
Dominion Bank
0.41
0.15
0.24
0.08
1.00
16.70
Samsung
0.33
0.29
0.16
0.22
0.20
1.00
26.70
BP
0.30
0.21
0.24
0.12
0.16
0.17
a. Calculate the portfolio variance for seven different portfolios. (Use decimals, not percents, in your calculations. Do not round
intermediate calculations. Enter your answers as a decimal rounded to 5 places.)
1.00
22.00
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