Note:-Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.Answer completely.You will get up vote for sure. A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term bond fund, and the thirdis a money market fund that provides a safe return of 8%. The characteristics of the risky funds are as follows:Expected StandardStock fund (S)Return Deviation20%30%12Bond fund (B)15The correlation between the fund returns is 0.10.Solve numerically for the proportions of each asset and for the expected return and standard deviation of the optimal risky portfolio.Note: Do not round intermediate calculations. Enter your answers as decimals rounded to 4 places.Portfolio invested in the stockPortfolio invested in the bondExpected returnStandard deviation

Here, Expected ReturnStandard DeviationStock Fund20%30%Bond Fund12%15%Risk Free Rate8%Correlation…

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term bond fund, and the third is a money market fund that provides a safe return of 8%. The characteristics of the risky funds are as follows: Expected Standard Stock fund (8) Return Deviation 20% 30% 12 15 Bond fund (B) The correlation between the fund returns is 0.10. Solve numerically for the proportions of each asset and for the expected return and standard deviation of the optimal risky portfolio. Note: Do not round intermediate calculations. Enter your answers as decimals rounded to 4 places. Portfolio invested in the stock Portfolio invested in the bond i Expected return Standard deviation

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term bond fund, and the third is a money market fund that provides a safe return of 8%. The characteristics of the risky funds are as follows: Expected Standard Stock fund (8) Return Deviation 20% 30% 12 15 Bond fund (B) The correlation between the fund returns is 0.10. Solve numerically for the proportions of each asset and for the expected return and standard deviation of the optimal risky portfolio. Note: Do not round intermediate calculations. Enter your answers as decimals rounded to 4 places. Portfolio invested in the stock Portfolio invested in the bond i Expected return Standard deviation

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 5P

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