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USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

Question 38

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USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
Stocks A and B have a correlation coefficient of -0.8. The stocks' expected returns and standard deviations are in the table below. A portfolio consisting of 40% of stock A and 60% of stock B is constructed.
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) Stocks A and B have a correlation coefficient of -0.8. The stocks' expected returns and standard deviations are in the table below. A portfolio consisting of 40% of stock A and 60% of stock B is constructed. -Refer to Exhibit 6.14. What is the expected return of the stock A and B portfolio? A) 17.0% B) 17.5% C) 18.0% D) 18.5% E) 19.0%
-Refer to Exhibit 6.14. What is the expected return of the stock A and B portfolio?


A) 17.0%
B) 17.5%
C) 18.0%
D) 18.5%
E) 19.0%

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