Question

Returns on stocks X and Y are listed below: Period 1 2 3 4 5 6...

Returns on stocks X and Y are listed below:

Period 1 2 3 4 5 6 7
Stock X 9% 6% 1% 8% -1% 3% 10%
Stock Y -2% 9% 5% 12% -1% 6% 5%

Consider a portfolio of 80% stock X and 20% stock Y.

What is the (population) standard deviation of portfolio returns?

Please specify your answer in decimal terms and round your answer to the nearest thousandth (e.g., enter 12.3 percent as 0.123).

Note that the correct answer will be evaluated based on the full-precision result you would obtain using Excel.

Math   Statistics-And-Probability   
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Answer #1

Answer:-

Given That:-

A portfolio of 80% stock X and 20% stock Y.

X Y
9 -2
6 9
1 5
8 12
-1 -1
3 6
10 5
Sum = 36 34
Average = 5.142857 4.857143
SD = 4.220133 5.014265
Cov = 4.44898

What is the (population) standard deviation of portfolio returns?

SD of portfolio = ?

= 13.82748

SD of portfolio = 3.72 %

Plz like it...........,

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