Stocks A and B have following returns. Stock A Stock...
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Accounting
Stocks A and B have following returns.
| Stock A | Stock B | |
| 1 | .08 | .07 |
| 2 | .04 | .03 |
| 3 | .13 | .05 |
| 4 | -.04 | .02 |
| 5 | .08 | -.04 |
a. What are the expected returns of the two stocks?
b. What are the standard deviations of the returns of the two stocks?
c. If their coreection is .44, what is the expected return and standard deviation of a portfolio of 74% stock A and 26% stock B?
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