You plan to invest in stock x stock y or some combination, Financial Management

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You plan to invest in stock x stock y or some combination

You plan to invest in Stock X, Stock Y, or some combination of the two. The expected return for X is 10% and σx= 5%. The expected return for Y is 12% and σy = 6%. The correlation coefficient, ρxy, is 0.75.

Suppose the correlation of stock X with the market pxm, is 0.8, while correlation of stock Y with the market, pym, is 0.9. Use this information, along with the other data, to determine the betas of stock X and stock Y.

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Financial Management: You plan to invest in stock x stock y or some combination

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