Ned both parts .. Assume that you manage a risky portfolio with an expected rate of return of 20% and a standard deviation of 41%. The T-bill rate is 4%A client prefers to invest in your portfolio a proportion (y) that maximizes the expected return on the overall portfolio subject to theconstraint that the overall portfolio's standard deviation will not exceed 30%.Required:a. What is the investment proportion, y? (Do not round intermediate calculations. Round your answer to 2 decimal places.)> Answer is complete but not entirely correct.Investment proportion y71.43%b. What is the expected rate of return on the overall portfolio? (Do not round intermediate calculations. Round your answer to 2decimal places.)> Answer is complete but not entirely correct.Rate ofreturn31.34 X %

Standard deviation is the quantitative measure of risk of stock return and is measured as the…

Assume that you manage a risky portfolio with an expected rate of return of 20% and a standard deviation of 41%. The A client prefers to invest in your portfolio a proportion (y) that maximizes the expected return on the overall portfolio su constraint that the overall portfolio's standard deviation will not exceed 30%. Required: . What is the investment proportion, y? (Do not round intermediate calculations. Round your answer to 2 decimal p

Assume that you manage a risky portfolio with an expected rate of return of 20% and a standard deviation of 41%. The A client prefers to invest in your portfolio a proportion (y) that maximizes the expected return on the overall portfolio su constraint that the overall portfolio's standard deviation will not exceed 30%. Required: . What is the investment proportion, y? (Do not round intermediate calculations. Round your answer to 2 decimal p

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 12P

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