Computation of variance and standard deviation

Reference no: EM1316525

Computation of Variance and standard deviation of a portfolio

Consider the following information:

Rate of Return if State Occurs
State of Economy Probability of State of Economy Stock A Stock B Stock C
Boom .20 .30 .45 .33
Good .40 .12 .10 .15
Poor .30 .01 -.15 -.05
Bust .10 -.06 -.30 -.09

Your portfolio is invested 30 percent each in A and C, and 40 percent in B. What is the expected return of the portfolio?

What is the variance of this portfolio? The standard deviation?

Reference no: EM1316525

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