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Exact expected risk premiums on the portfolio

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Reference no: EM132531136

1) Consider the following information about three stocks

a. If your portfolio investment is composed of 45% for Stock A, and a 65% for Stock B. What is the portfolio expected return? variance? And standard deviation?

b. If the expected T-Bill rate is 3.90%. What's the expected risk premium of the portfolio?

2) Considering the same information in problem 1, what is the covariance & correlation between Stock A & Stock B.

3) Considering the same information of problem 1, if inflation is 3.40%:

a. What are the approximate and the exact expected real returns on the portfolio?

b. What are the approximate and the exact expected risk premiums on the portfolio?

Reference no: EM132531136

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