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Calculation of variance for Delta, Caps and BAT and calculation of variance of portfolio and standard deviation of portfolio
You are given the following variance-covariance matrix of counters Delta, Caps and BAT. Weight of Delta = 0.40, weight of Caps = 0.25 and weight of BAT = 0.35.
Delta
Caps
BAT
148
180
140
154
120
160
170
130
125
(a) Calculate be variance of Delta, Caps and BAT.
(b) Calculate the variance of portfolio using the following formulae:σ2Ρ = ΣΣXi, Xj, σi,j
(X stands for weight)
(c) Calculate the standard deviation of the portfolio.
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