Reference no: EM13929538
Finance - portfolios
Stock A - expected return = 7%, standard deviation of turn = 10%, beta = 2
Stock B - expected return = 6%, standard deviation of turn = 20%, beta = 1.5
correlation coefficient = 0.5
risk free rate = 1%
market risk premium = 4%
60% of funds invested in Stock A, 40% of funds invested in Stock B.
1) Find expected return of portfolio
2) Find standard deviation of portfolio
3) Find Sharpe ratios of Stock A, Stock B and portfolio
4) Find beta of portfolio
5) Find expected return of portfolio, under CAPM
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