QUESTION 1 Some of a portfolio consists of stock A, which has an expected return of 17.65% and a standard deviation of returns of 23.68%, and the rest of the portfolio consists of stock B, which has an expected return of 17.65% and a standard deviation of returns of 23.68%. If the returns of stock A and stock B do not move perfectly together in the same direction by the same relative amount, then which one of the following assertions is true? Assume that the portfolio has at least some stock A and some stock B. O The expected return of the portfolio is not 17.65% and the standard deviation of the portfolio is not 23.68 O The expected return of the portfolio is not 17.65% and the standard deviation of the portfolio is 23.68 The expected return of the portfolio is 17.65% and the standard deviation of the portfolio is 23.68 The expected return of the portfolio is 17.65% and the standard deviation of the portfolio is not 23.68 The question can not be answered without more specific information on how much of the portfolio consists of stock A and how much consists of stock B

QUESTION 1 Some of a portfolio consists of stock A, which has an expected return of 17.65% and a standard deviation of returns of 23.68%, and the rest of the portfolio consists of stock B, which has an expected return of 17.65% and a standard deviation of returns of 23.68%. If the returns of stock A and stock B do not move perfectly together in the same direction by the same relative amount, then which one of the following assertions is true? Assume that the portfolio has at least some stock A and some stock B. O The expected return of the portfolio is not 17.65% and the standard deviation of the portfolio is not 23.68 O The expected return of the portfolio is not 17.65% and the standard deviation of the portfolio is 23.68 The expected return of the portfolio is 17.65% and the standard deviation of the portfolio is 23.68 The expected return of the portfolio is 17.65% and the standard deviation of the portfolio is not 23.68 The question can not be answered without more specific information on how much of the portfolio consists of stock A and how much consists of stock B

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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