Using following information determine expected return, variance, and standard deviation of stock A and B. Also determine covariance and correlation between Stock A and B.
|
States
|
Probability
|
Return on Stock A
|
Return on Stock B
|
|
1
|
20.00%
|
26.00%
|
9.00%
|
|
2
|
30.00%
|
18.005
|
15.00%
|
|
3
|
50.00%
|
10.00%
|
30.00%
|
If invest 10,000 in stock A and 15,000 in Stock B what would be the portfolio return and risk.