Essay
Use the information for the question(s)below.
You are presently invested in the Luther Fund,a broad-based mutual fund that invests in stocks and other securities.The Luther Fund has an expected return of 14% and a volatility of 20%.Risk-free Treasury bills are currently offering returns of 4%.You are considering adding a precious metals fund to your current portfolio.The metals fund has an expected return of 10%,a volatility of 30%,and a correlation of -.20 with the Luther Fund.
-Will adding the precious metals fund improve your portfolio?
Correct Answer:
Verified
Yes 
= = = -0.3
ri = rf + × (E[Rp] - ...View Answer
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Correct Answer:
Verified
= = = -0.3ri = rf +
× (E[Rp] - ...View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
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