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Business, 11.09.2019 21:30 noahdeem135

Suppose you have some money to invest – for simplicity, $1 – and you are planning to put a faction ω into stock market mutual fund and the rest, 1- ω, into a bond mutual fund. suppose that $1 invested in a stock fund yields rs after 1 year that $1 invested in a bond fund yields rb, suppose that rs is random with mean 0.08 (8%) and standard deviation 0.07, and suppose that rb is random with mean 0.05 (5%) and standard deviation 0.04. the correlation between rs and rb is 0.25.

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Suppose you have some money to invest – for simplicity, $1 – and you are planning to put a faction ω...
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