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Assume that the average variance of return for an individual security is 50 and that the...

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Finance

Assume that the average variance of return for an individualsecurity is 50 and that the average covariance is 10. What is theexpected variance of an equally weighted port- folio of 5, 10, 20,50, and 100 securities?

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The average variance of return for an individual security 50 The average covariance 10 Expected variance of an equally weighted portfolio of 5 where n 5 Expected variance 1n average variance n2 nn2 average covariance 15 50 52 55210 10 2025 10 18    See Answer
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