Stocks A and B have the following returns: A B

1 A 0.09 B. 0.06

2 A 0.06 B. 0.04

3 A 0.14 B. 0.06

4 A -0.03 B. 0.03

5 A 0.07 -0.05

a. What are the expected returns of the two stocks?

b. What are the standard deviations of the returns of the two stocks?

c. If their correlation is 0.48 , what is the expected return and standard deviation of a portfolio of 52% stock A and 48% stock B?

2

step-by-step explanation:

2 pecks

step-by-step explanation:

step-by-step explanation:

consider the parallelogram shown in the attached image.

in the parallelogram hijk, the length of hk is given as,

from the properties of parallelogram we know that the opposite sides of a parallelogram are parallel to each other and are equal in measure.

therefore, the length of the side ij must be equal to the length of the side hk and that is .

hence, the expression for the length of ij confirms that hijk is a parallelogram.