Annualized Mean Annualized Std Dev Country Return (in %) of Return (in %) US UK...
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Annualized Mean Annualized Std Dev Country Return (in %) of Return (in %) US UK 6.12 3.12 20.16 15.28 23.11 28.02 20.13 China Canada 8.76 The pairwise return correlations matrix is: US 1.00 Canada 0.81 US UK UK 0.72 1.00 0.52 0.73 China 0.45 - 1.00 0.55 China Canada - - 1.00 Question 3 1 pts In each case above, the minimum standard deviation attainable is lower when using the five assets (four risky plus the riskless) than when using only the four risky assets. Explain why that is happening. Be as clear as you can. HTML Editora B 1 A = x = = 0 & A NV = = = het en het in Vo = l x 12pt Paragraph O words Question 4 0.5 pts Consider the weights on just the risky assets in the 5-asset optimal portfolios. Do the weights on the risky assets have any relations with each other as you move from one optimal portfolio to the other, e.g. moving from optimal E(r)=7% to optimal E(r)=25%? Explain clearly. Note: Remember the picture of the optimal set of portfolios in the CAPM world. Annualized Mean Annualized Std Dev Country Return (in %) of Return (in %) US UK 6.12 3.12 20.16 15.28 23.11 28.02 20.13 China Canada 8.76 The pairwise return correlations matrix is: US 1.00 Canada 0.81 US UK UK 0.72 1.00 0.52 0.73 China 0.45 - 1.00 0.55 China Canada - - 1.00 Question 3 1 pts In each case above, the minimum standard deviation attainable is lower when using the five assets (four risky plus the riskless) than when using only the four risky assets. Explain why that is happening. Be as clear as you can. HTML Editora B 1 A = x = = 0 & A NV = = = het en het in Vo = l x 12pt Paragraph O words Question 4 0.5 pts Consider the weights on just the risky assets in the 5-asset optimal portfolios. Do the weights on the risky assets have any relations with each other as you move from one optimal portfolio to the other, e.g. moving from optimal E(r)=7% to optimal E(r)=25%? Explain clearly. Note: Remember the picture of the optimal set of portfolios in the CAPM world
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