What is the expected return and volatility of a portfolio


Suppose Ford Motor stock has an expected return of 18 % and a volatility of 40 %, and Molson Coors Brewing has an expected return of 14 % and a volatility of 29%. If the two stocks are? uncorrelated,

a. What is the expected return and volatility of a portfolio consisting of 69 % Ford Motor stock and 31 % of Molson Coors Brewing stock?

b. Given your answer to(a), is investing all of your money in Molson Coors stock an efficient portfolio of these two stocks?

c. Is investing all of your money in Ford Motor an efficient portfolio of these two stocks?

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Financial Management: What is the expected return and volatility of a portfolio
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