Alice's portfolio consists solely of an investment in Merrill stock. Merrill has an expected return...
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Finance
Alice's portfolio consists solely of an investment in Merrill stock. Merrill has an expected return of 13% and a volatility of 18%. The market portfolio has an expected return of 12% and a volatility of 25%. The risk-free rate is 4%. Assume that the CAPM assumptions hold in the market Assuming that Alice wants to maintain the current expected return on his portfolio, then the amount that Alice should invest in the market portfolio to minimize his volatility is closest to: Select one: A. 110% B. 90% C. 125% D. 100% Clear my choice
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