Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. a pension fund manager is considering three mutual

A pension fund manager is considering three mutual funds. The first is a stock fund, the...

60.1K

Verified Solution

Question

Finance

A pension fund manager is considering three mutual funds. Thefirst is a stock fund, the second is a long-term government andcorporate bond fund, and the third is a T-bill money market fundthat yields a sure rate of 5.9%. The probability distributions ofthe risky funds are:

  

Expected ReturnStandard Deviation
   Stock fund (S)20%        49%         
   Bond fund (B)9%        43%         

  

The correlation between the fund returns is .0721.

  

What is the expected return and standard deviation for theminimum-variance portfolio of the two risky funds? (Do notround intermediate calculations. Round your answers to 2 decimalplaces.)

  

  Expected return%
  Standard deviation%

Answer & Explanation Solved by verified expert
4.0 Ratings (760 Votes)
    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

If the scattering intensity of a liquid is 8 units at a wavelength of 500...

Physics
Q

Full Boat Manufacturing has projected sales of $124 million next year. Costs are expected to be...

Finance
Q

Calculate the minimum prestressing force required for Beam 1 knowing that the beam has a cross...

Civil Engineering
Q

Coefficient of friction between A and B is u The minimum force F with which...

Physics
Q

Customers can pick their own blueberries at Blueberry Hill. They pay $5 toenter the patch...

Basic Math
Q

A blue candle and red candle are lit at the same time but burn at...

Algebra
Q

which of the following statements is not correct concerning how ira distributions are taxed. a,...

Accounting
Q

Cranberry Corporation has $3,396,000 of current year taxable income. Use Corporate tax rate schedule. If...

Accounting
Q

Exercise 5.7 (Algo) Contribution margin LO A1 A jeans maker is designing a new line...

Accounting
Q

Hector Gaming Company Hector Gaming Company (HGC) is an educational gaming company specializing in young...

Accounting
Q

MerrkdGT Gaming company is considering an investment in a new PC equipment costing $260,000. The...

Accounting
Q

Sirhuds Inc., a maker of smartwatches, reports the information below on its product. The company...

Accounting