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Calculate the average expected return on portfolio x and y

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The following table shows the expected returns on three assets X, Y, Z for the period 2017-2021. Assume that the investor is willing to form a portfolio of X and Y or X and Z. He also is planning to invest 2/3 of his investment funds in X and 1/3 in Y or Z.

Year               Rx (%)        Ry (%)        Rz (%)

2017                8                   24           8

2018                 10                  20         12

2019                  12                16            16

2020                  14                 12            20

2021                 16                     8             24

Answer the following questions accordingly:

Question 1: Calculate the average expected return on portfolio X and Y.

Question 2: Calculate the average expected return on portfolio X and Z.

Question 3: Calculate the standard deviation of portfolio X and Y.

Question 4: Calculate the standard deviation of portfolio X and Z.

Question 5: What is your advise to this investor.

Reference no: EM132684913

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