Wealth Management Solution for Your Clients
Your clients’ risk attitude measure is 4. The T-Bill rate is 3%.
Your clients have $1million to manage between the T-Bill and a risky portfolio.
You consider to recommend one of the following two risky portfolios A & B for this client: Portfolio
A: expected return 10%, standard deviation 20%; Portfolio
B: expected return 14%, standard deviation 22%.
1. Which risky portfolio will you recommend to your client?
2. What is its right weight?