If there are no restrictions on short sales or borrowing


If there are no restrictions on short sales or borrowing, what is the expected return and standard deviation on the portfolio of these two assets if they are invested half in A and half in B?

a. Exp. Return(ab) =9.0% and Standard Deviation = 9%
b. R(ab)= 11.0% and SD = 6%
c. R(ab) = 11.0% and SD= 6%
d. R(ab) = 12.0% and SD = 9%
e. None of the above.

 

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Finance Basics: If there are no restrictions on short sales or borrowing
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