Part 3 (ch11) Questions Numeric
Last updated: 25/02/2025
Type your answers with “.” instead of “,”! For numerical answers, use 2 decimal places. For instance, if your answer is 0.12345 or 12.345%, type, “12.34” in the box.
Question 1
Q: What is the expected return of a portfolio that invests 0.244 percent in Asset 1 (expected return = 0.027) and the remaining 0.756 in Asset 2 (expected return = 0.154)?
Q: Assuming that the correlation between these assets is 0.405, and that the standard deviation of Asset 1 is 0.287 while the standard deviation of Asset 2 is 0.137, what is the variance of the portfolio above?
Q: Assuming that the correlation between these assets is 0.405, and that the standard deviation of Asset 1 is 0.287 while the standard deviation of Asset 2 is 0.137, what is the standard deviation of the portfolio above?
Answer
- 12.282, 2) 2.144, 3) 14.642.
Question 2
Q: Suppose you purchase 119 shares of Company A at 54.23 per share, 231 shares of Company B at 22.91 per share, and 243 shares of Company C at 33.95 per share.
What is the weight on Company A in your portfolio (in %)?
Answer: 32.27